BraunAbility’s Nick Gutwein: “Exciting Time for Us”
- By Laurie Watanabe
- Oct 04, 2015
Even in an industry that’s become well accustomed to acquisition news, this particular announcement was very intriguing: In late September, Investor AB acquired BraunAbility, one of the best-known names in the adaptive automotive world.
Investor AB, of course, already owns Permobil thanks to a 2013 purchase. And that raised interesting questions about possible collaborations across two different mobility industries that serve the same end user, as well as what to expect from BraunAbility moving forward.
A Time of Transition
The past few years had been a time of change for BraunAbility, even before Investor AB came calling.
Ralph Braun had built his first power wheelchair as a teen and later progressed to inventing wheelchair vehicle lifts to stay independently mobile as his spinal muscular atrophy progressed. He founded Braun Corp. in 1972, and his company grew to become one of the leaders in the wheelchair-accessible vehicle market. The Braun Corp. became known as BraunAbility in 2008.
Ralph Braun remained at the heart of the company until he died in 2013.
“Obviously, we’ve had a very rich history with Ralph Braun, what he built in the company, and then we had a very challenging change to us when Ralph passed away,” BraunAbility CEO/President Nick Gutwein said, speaking with Mobility Management a few days after the official acquisition announcement. “But prior to that, he had the vision to set up an ownership structure, and it’s worked well for us for three and a half years. He knew that he was going to be dealing with this terminal cancer, and it motivated him to recapitalize back then. So we were very happy, and things have been going quite well with our current ownership structure, and really we had no intention to sell. We were not actively out trying to sell our company at all.”
So when Investor AB — and their New York-based Patricia Industries division — contacted BraunAbility this spring, Gutwein admits being “kind of cautious” and wondering what Patricia Industries had in mind.
Imagining the Possibilities
But by the time Patricia Industries representatives officially reached out, they knew BraunAbility quite well.
“They had done a lot of homework on BraunAbility,” Gutwein says. “They had a pretty good two-and-a-half-year run and were very happy with their Permobil acquisition, and so they knew us well and knew our brand well, and felt that they could help us to grow, could help us outside of North America, and within our operation. And they also were very clear that their strategy or their investment approach is ‘long-term hold.’ So they’re not your traditional private-equity buyer that will buy and then lever up the company and then recapitalize in five to seven years. We did not want to do that. We were totally against that kind of approach.”
Instead, the involvement of Investor AB has BraunAbility looking down the road and wondering at the possibilities. Asked what his hopes are for future, Gutwein says, “Really to help to accelerate the plans to grow the company, entering new markets and new product lines, and then also we have some ideas to invest in our operation in Winamac, Ind.”
And then of course, there could be possible collaborations with another member of the Investor AB family. The possibilities would have been interesting enough had Investor AB’s mobility portfolio only included Permobil. But in 2014, Permobil acquired ultralightweight wheelchair manufacturer TiLite. This year, Permobil added seating manufacturer ROHO Inc.
Asked if he’s contemplated future collaborations, Gutwein said, “We sure have. We were not at all pursuing a sale of the company. But the Permobil connection was one that really kind of solidified our interest once [Investor AB] showed how strongly they were interested in us, and we started doing a little bit of study on Investor AB. We have a tremendous admiration for Permobil and its brand, and yes, we have thought about that. Nothing concrete, but you can imagine a company that knows power wheelchairs — and now manual wheelchairs with TiLite — and has an understanding of needs from a chair perspective, and if you marry that with our leadership in the area of transportation for people with disabilities, you can see maybe some design collaborations, some marketing work together. It seems very interesting, but nothing concrete yet.”
Management Will Stay in Place
As for day-to-day operations, Gutwein indicated it will largely be business as usual — in part because he and other BraunAbility executives are partial owners of the company themselves.
“Investor AB, Patricia Industries, will be the majority owner for sure,” he explained. “But myself and our other senior executives will not only be there to stay in our current jobs — so I’ll stay as CEO, Tom Eastman will stay our CFO, everyone will be in place — but we also have ownership. We have a sizable investment ourselves in the company, so we’re excited by that, too.”
Though Investor AB is headquartered in Stockholm, Sweden, Patricia Industries is headquartered in the United States, and “We are their first foray into buying a U.S. company,” Gutwein noted.
Mobility dealers working with BraunAbility won’t notice anything different, Gutwein added. “I think that they’re going to see things pretty much the same as we’ve been operating. We have a great relationship with our dealer network, and nothing will change. Our name won’t change, the ordering process won’t change. Investor AB is buying us because we are a strong brand and a healthy company, so fundamentally, they won’t be changing our operational approach to the business. It’s more so just helping to drive growth and add product lines and expand our portfolio.”
He said expansion and acquisition are very likely, “but it’s kind of multi-dimensional. For example, I think part of that is looking at the global market for our products and opportunities, so there could be some there. Acquisitions would likely be a part of our thinking going forward, but it’s very early to tell where and what direction we’re going to go with that. But clearly, you’ve seen that in Permobil, and you will see that with us if we feel like there are complementary products or markets we can extend into through acquisition. We’ll certainly consider those.”
An Exciting Time
Gutwein said the things he’s excited about include the belief that Ralph Braun’s inspirational history is in good hands with Patricia Industries and Investor AB.
“[For] about 45 years the company will have had its track record largely built on the legacy of Ralph Braun,” he said. “So what I’m most excited about is our people in Winamac, Ind., who I believe now will have an investor and a partner that will be a decades-long company, a long-term owner — [one] that is interested in continuing that legacy of Ralph Braun and also in extending that to the industry, to our dealer network. I see this as a way to solidify that for the long term. That’s what excites me the most.
“I think it’s wonderful for our industry, and I think it’s a wonderful industry to be in.”
Laurie Watanabe is the editor of Mobility Management. She can be reached at firstname.lastname@example.org.