Interview with Menno Holterman, CEO of Nijhuis Saur Industries

By Jac van Tuijn, journalist WaterForum (original interview in Dutch)

It was a great start for Nijhuis Industries after their takeover by the French company, Saur in 2020. This is the opinion of Menno Holterman, who has been appointed to lead all industrial activities for the French water giant from Doetinchem, the Netherlands. The sale will by no means be a loss for the Dutch water technology sector, he explains in his interview with the Dutch water magazine ‘WaterForum’.

The water sector was hit by a bombshell on the nineteenth of June in 2020. The news about Nijhuis was always that they had taken over some foreign company and, as a result, could continue their growth to become a leading Dutch water technology company that builds industrial water treatment installations all over the world. In 2019, the company achieved a turnover of €90 million.

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It was also a year where the one hundred and fifteenth anniversary of the company was loudly celebrated in Doetinchem. Invitees were given the opportunity to view the impressive manufacturing facility, where filters, dissolved air flotation units, pumps, sludge presses and sensors, are assembled into installations that are shipped all over the world. The company is continuously reporting new contracts and innovative breakthroughs.

Why a takeover? Together with CFO Ronald Ruijtenberg and the current co-investors, director Menno Holterman could have just waited for a buyer to come along. But the team is too entrepreneurial for such a scenario. Instead, they decided to embark on an adventure with Saur to become an even larger international player in the rapidly changing global water technology market.

How did it all go?

“It is a great honour that we can the best of both between France and the Netherlands. This immediately resulted in several real opportunities that we previously did not know existed. From this, we have already been able to conclude our first contracts, such as an Operation and Maintenance contract for a Spanish pharmaceutical company. The advantage of a large company such as Saur, is that we now have a larger budget to be able to conclude long-term build-operate-transfer contracts. This enables us to contribute much larger co-financing, whereas previously our ability to invest was simply less.”

Why such a great honour?

“Saur already has a large market share in France but has the ambition to gain another billion euros in extra turnover. This growth will mainly have to come from abroad, and with the industrial platform in Doetinchem, we can contribute to that growth with our international experience and our global network across than 140 countries. Saur recognizes that we are a flexible organization, with a widely deployable and complimentary technology portfolio. This makes it easy for us to rapidly respond to changes within the water market.

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For many customers, it is no longer just about the shortest payback period and minimum compliance with environmental requirements. Industrial customers are also looking to the future and asking the questions:

  • Will my water treatment also be adequate in 10 to 15 years?
  • Is there enough water available?
  • Can I scale up or scale down quickly enough to respond to the market?
  • Can I reuse more treated wastewater?

"For many customers, it is no longer just about the shortest payback period and minimum compliance with environmental requirements. Industrial customers are also looking to the future"

Flexibility is becoming ever more important, and a different set of water technologies are required. Our customers appreciate the added value we can offer. Helping to find improvements, consuming less energy, providing a more environmentally friendly solution, more energy production and raw material recovery, and of course working together collaboratively with the local government on an industrial estate. Smart design, smart construction, and smart management are becoming increasingly important, a trend Saur is recognizing as well.”

What is Smart?

“For us, that is for example the designed construction of modular installations that we can monitor, manage and maintain online. For our customers, the cost price is increasingly under pressure, or there is insufficient capital available. That is why we have invested heavily in the automation of our installations, and we already monitor 150 of them online, 24/7. Two employees keep an eye on the online data, and continuously check whether the installation is running smoothly, whether efficiency gains can be achieved, and whether business operations can be improved.

We have also invested in expanding our rental fleet of more than 50 treatment plants. And in modular design: we build standardized units in containers that we can use generically, so that we can easily access the installation and exchange parts quickly. This way we keep maintenance costs low. But we have also developed them in such a way that we can easily adapt them to the specific circumstances of the customer. "

Why allow Saur to invest now? Because of corona?

“The corona crisis has accelerated things, but the first reason is the changing water market and our conclusion that the concession model, with which industry peers Veolia and Suez have been making a lot of money for a long time, has had its day. Large industrial customers no longer want to tie themselves into a 15-year contract in which only the concessionaire earns money.

Sharing knowledge and benefits is becoming increasingly more important, which is also in line with the transformation to the circular economy. Flexibility is essential, and for this, we at Nijhuis Industries have developed a different business model over the years, which is much more based on cooperation and shared ownership. With Saur alongside, we now expect to be able to grow these shared revenue models much faster.”

"Sharing knowledge and benefits is becoming increasingly more important, which is also in line with the transformation to the circular economy."

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Shared Revenue Models?

“Our local teams and partners will play an increasingly important role in forging these new shared revenue models. They have greater knowledge about local water issues, the authorities, and the wishes of the customers. The future is therefore less central and more local. This means that we must continue to invest heavily in our network in order to increase that local presence. But we cannot do everything ourselves, and we had to make a choice. That choice became Saur.”

What role did corona play?

“We have been able to travel less in recent months due to the corona pandemic. For example, our people could unfortunately not travel to Bulgaria for the completion of a treatment plant. We are now addressing the construction delays, using our regional team. Corona has once again made it clear how important this local presence is for a globally operating company like Nijhuis. for acquiring new contracts. It is no longer enough to be able to add the name of a local company to a tender.

You can also see the trend that central governments are starting to protect their economy more strongly and require their national companies to participate in large contracts. Corona has made it clear that geopolitics is getting important again. This is how the internal European market has become wedged between the competing superpowers of Trump, Xi Jinping and Putin. I have been calling for years that the Dutch water sector should see Europe as a home market. I also see how European countries are achieving success. Take Spain, for example. They have succeeded in building up a strong contracting sector, within 15 years, that is successful worldwide in winning large EPC and O&M contracts for the construction of water installations.”

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What do you mean, geopolitics?

“Globally operating companies are attracting major customers and major water infrastructure projects. Few companies are big enough to handle that, so there is much less competition. But the tender is much more political. Take, for example, the new capital that Egypt is currently building, which will house 54 government buildings, and where some 2 million people will live. We have tried to win the contract for the water infrastructure.

Together with several public and private Dutch parties, we have worked day and night on this for months and have been to Egypt countless times. France and Germany both submitted an integrated plan for the entire infrastructure. The French plan was presented by president Macron, and the German plan by Chancellor Merkel. Still, the Egyptians really wanted an integrated Dutch solution. But in the end, the Germans won, because the French had already received the contract for the energy supply.

The Netherlands does not have Shell, Philips or ASML for water. That is why, we, as a Dutch water sector, should invest in the European water market. A home market in which we can do business safely and securely with each other. The emphasis will also be on the development of the industrial platform.”

Has the Netherlands missed the boat now?

“In the Netherlands we tried to integrate some of the leading Dutch players into a large public-private water company. In 1999 an attempt was made to link the water leg of the then Nuon to Norit and Paques. That was then stopped by politicians. Water was not to be privatized, and that still applies in the Netherlands. Private-public cooperation is very common in the global market.

There are also great opportunities, for example, when it comes to joint activities at municipal water treatment plants where industrial wastewater can also be processed. Another great example is that companies increase their water production to provide drinking water to the local communities. I certainly believe that the public and private water sectors will increasingly converge. Especially where water is scarce and the need for water reuse is increasing.”

"There are also great opportunities, for example, when it comes to joint activities at municipal water treatment plants where industrial wastewater can also be processed."

About the new Industry Division

Following the completion of the Nijhuis Industries acquisition, the Saur Group will now bring all those entities serving industrial customers together within the new division. As a result, Saur Industry, Unidro and Econvert will gradually merge with Nijhuis over the coming months to create the new Industry Division with effect from January 2021. It is therefore clear that this strategic investment by the Saur Group puts industry at the heart of its growth model.

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The less known French water giant: Saur

Saur Group is a French company that, together with Suez and Veolia, is one of the top three French water companies. Saur Group is a French company that, together with Suez and Veolia, is one of the top three French water companies.

It was founded in 1933 by Pierre Crussard under the name Société d’Aménagement Urbain et Rural (Saur), and initially focused mainly on the French countryside. Since it has always been less active abroad, unlike Veolia and Suez, it has remained little known on the international stage. Since it has always been less active abroad, unlike Veolia and Suez, it has always remained less known internationally.

The company now has 9,000 employees, and achieved a turnover of 1.497 billion euros in 2019. Saur manages over 4,000 water installations, mainly in France, but also in other countries. Saur manages over 4,000 water installations, mainly in France, but also in other countries.

In December 2018, Saur Group came into the hands of the Swedish investor EQT.