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Baxi hires new CEO in strategy drive

Baxi Holdings has appointed a new chief executive officer (CEO), as it seeks a change in strategy as the heating markets become more competitive.

 

Martyn Coffey, the managing director of Baxi’s UK Businesses, has been promoted to Group CEO. He takes over from Mark Edwards, who resigned from his position on January 12.

 

The change in leadership signals a change in direction for the Group which has endured a turbulent past year. In July, Baxi Holdings entered into discussions with its lenders – private equity firms BC Partners and Electra Partners - to negotiate more favourable terms on its £515m debt obligations.

 

The move came as the company attempted to stave off the risk of defaulting on its loan repayments as it struggled to cope with higher interest rates and a downturn in demand for its heating products, particularly in France and Germany.

 

This re-negotiation was successfully completed in November last year.

 

In an interview with H&V News, Mr Coffey explained that his promotion, which was “a natural progression, subject to performance”, had been sanctioned by Mr Edwards and the Group’s major shareholders.

 

The board felt it was time for a change,” he explained. “Under Mark the Group had been very acquisitive, and was able to expand successfully throughout Europe. However, as we’ve moved into tougher economic conditions and the slowdown [has become more pronounced], this strategy has become less important to the Group’s future development.

 

“It was felt that felt that the Group should concentrate more on balancing growth with the focus being on cost reductions and tighter controls; a change in leadership was made to reflect those new priorities.”

 

“Mark recognized that his strengths lay in acquisitions, and so chose to resign,” Mr Coffey continued. “He will still be involved in the company and will become a shareholder in the Group.”

 

Mr Coffey said the Group’s was now focused on country management. “We shall be looking at how we can get the best synergies in Europe while keeping the focus on the individual country.

 

“The challenge for us now in today’s business climate is that European market products are becoming more aligned. The industry is moving away from box shifting and focusing more on system solutions. We are concentrating more on providing heating and boiler solutions. Heat pumps, CHP etc are very important products for us,” he concluded.

 

Baxi Holdings is the vehicle set up to facilitate the management buyout of the Group in March 2004.