The underlying reason is to support growth in Europe
The listing of consulting firm ADEC Innovations NV on the Access segment of Euronext Brussels deserves some explanation, as it is not your everyday IPO. It is taking place without a capital increase or public offering of shares. Furthermore, the group’s activities cannot be summarized in a few words. A conversation with Chairman James Donovan clarified a lot.
Activities
ADEC Innovations Group, holding company of ADEC Innovations NV, was founded in the Philippines in 1996 and its co-founders, current CEO James Donovan and CFO Carol Esguerra, still hold 100% of the shares. Since its inception, the company has grown significantly: in 2024, it posted a turnover of EUR 81.4 million. Today, the group consists of 28 different subsidiaries with a total of 4,000 employees worldwide, active in ‘providing business intelligence, offering solutions to tackle all kinds of contemporary challenges, and delivering innovative sustainability solutions that address the ESG concerns of organizations, governments, and NGOs’. These 28 subsidiaries were established because they had each built up a particular specialization and were able to meet a specific business need. For example, one subsidiary focuses on managing supply chain risks, another focuses on healthcare information management, while ADEC Innovations Group also has a company that focuses on education.
One of the group’s most important subsidiaries is ADEC Innovations NV, based in the Netherlands. This entity has 210 employees and generated a turnover of around EUR 15 million in 2024, 95% of which came from U.S. customers and 2% from European customers. It offers integrated solutions in the areas of ESG consulting, environmental compliance, data intelligence, and outsourcing services. For example, it manages ESG data assurance, impact sourcing, sustainability scorecards, and air quality management . Today, it serves 612 customers across a wide range of sectors, including consumer goods, government services, financial services, healthcare, retail, maritime, and real estate. It is this subsidiary that has been listed on Euronext Access Brussels.
Unconventional stock market listing
On Friday, July 25, ADEC Innovations NV was listed on the Euronext Access Brussels stock exchange. This IPO took place in an unconventional manner. First and foremost, this IPO came as a surprise, as almost no one was aware of it until a few days before. However, for CEO of ADEC Innovations Group and Chairman of ADEC Innovations NV James Donovan, the choice of Brussels was not a surprise or a sudden decision. “The IPO on Euronext Brussels is the result of a long and carefully considered process lasting almost two years. ADEC Innovations Group has carefully prepared this step as part of a long-term strategy, thoroughly investigating various options and locations. The choice of Brussels was partly determined by the advantages of Euronext, the European market structure, and relevant partnerships in the region. It was therefore anything but a sudden decision, but rather the result of targeted preparation and strategic considerations in line with our mission to create greater impact.” He adds that the decision to list the entity ADEC Innovations NV was specifically made because of its “growth potential.”
Secondly, it is striking that the share has been listed on the stock exchange (ticker code: MLADE) but that no trading has taken place to date. ADEC Innovations NV itself states that its shares have been ‘admitted’ to Euronext Access Brussels: in jargon, this is called a direct listing. This means that no new shares have been issued, no existing shares have been sold, and no capital has been raised. As you can see below, a theoretical price of EUR 10 has been set, and this price will remain unchanged until trading takes place. Today, there are two buy orders in the order book, but so far there are no sellers. This is unlikely to change in the short term, as the holders have no immediate plans to sell. In addition, 80% of the 200,100 admitted shares will remain in lock-up for at least one year.
According to James Donovan, this listing offers the possibility of raising money in the future if the growth trajectory requires it. It is therefore more of an IPO with a view to a later placement that can happen quickly, since the listing is already in place, and when the company deems it necessary. “To date, we have not needed any additional capital and have been able to finance the group’s growth from our own resources. In the medium term, this could change and investors could become shareholders.” He added that a potential capital increase would be considered at the right time – when conditions are favorable for the market, aligned with shareholders’ interests, and supportive of the compnay’s growing impact.
Why go public?
One might wonder why, if no money is needed immediately, the company is going public today. According to Chairman of the Board Donovan, there are a whole host of additional reasons, in addition to future financing and the creation of a secondary market for existing shareholders and employees (issuing options). “For visibility and credibility towards partners, customers, and governments. If we want to break through and grow in Europe, brand awareness and trust are of primary and great importance. In addition, we also want to ensure that we are compliant, which will increase our transparency.” Ultimately, according to Donovan, the intention is to create brand visibility in the European market and grow into Euronext Growth Market in the long term.
Isn’t it a bit late to go public after 30 years in business? “ADEC Innovations Group wanted to build a stable and efficient international structure first, which is why we have 28 entities. We see going public as the next step in a long-term strategy: deliver high quality and deliver more than expected. Ultimately, we want to grow in the region gradually, with an emphasis on reliability, trust, and impact, not on quick financing,” explains James Donovan. CFO Carol Esguerra adds that there is always a risk of raising too much money, as is the case with private equity today, and then making less sound investment decisions because the money is readily available. “We have always wanted to avoid that.” The CEO adds that a US listing was deliberately not chosen because ADEC Innovations NV would be just a drop in the ocean there. “The EU is more advanced and in line with ESG regulations, intellectual property, and impact-driven business operations.”
Growth in Europe
An important reason for going public in the heart of Europe is to put ADEC Innovations NV on the map in Europe and make it better known to European customers because, as mentioned earlier, European customers currently account for only 2% of revenue. “We are also seeing that, due to strict ESG requirements in Europe, companies are increasingly asking for help. In addition, many companies and organizations want to make a bigger impact, and that is exactly what we can offer,” emphasizes the Chairman. According to him, the choice for Europe was also motivated by several factors, the most important of which is to become a long-term and impactful partner in the region – the trusted partner of choice by companies in their impact and sustainability journey. “Europe offers a combination of strong regulation, technological innovation, and the presence of important institutions such as the European Union and multilateral organizations.” Donovan sees opportunities here to leverage the group’s expertise in supply chain consulting, risk management, sustainability, and resilience in a way that meets societal and economic needs.
Although ESG has come under pressure in recent years, there has been no decline in demand, but rather a repositioning. “Many of the services that previously fell under ESG are now approached in terms of resiliency or adaptation. We see new opportunities to increase our impact in this area. We are building on 30 years of experience in diverse markets and complex environments. This experience enables us to respond flexibly to changes such as geopolitical tensions, technological disruption such as AI, and shifting international priorities. Our approach is focused on helping organizations make better decisions and create sustainable value. Ultimately, that will never change. In short, ADEC Innovations NV sees Europe as a region where its knowledge, services, and experience can really make a difference and wants to be a reliable, relevant, and impactful partner in the long term.”
Change has always been there
Although ESG has lost some visibility in recent years, certainly in the United States, the underlying themes remain relevant. “One example is the trend toward reshoring, bringing manufacturing back to the US. Although this seems strategically attractive, it also poses major practical challenges in terms of infrastructure, staff shortages, and vulnerable supply chains. We respond to this by supporting clients in making better decisions. Our company helps them understand the risks, provides insight into the impact of these risks on stakeholder value, and offers solutions to mitigate these risks.”
Donovan points out that markets are constantly changing. “Policy changes can suddenly disrupt existing business models. At the same time, this is nothing new: legislation is always shifting, and with it, the nature and scope of projects. Moreover, the industry moves in cycles, with periods of rapid growth followed by moments of slowdown. ADEC Innovations NV’s strength lies in our ability to adapt to these fluctuations. For thirty years, we have maintained a flexible service offering, staying relevant through changing market conditions. Although the future is difficult to predict – especially in the current complex political and economic climate – we remain focused on delivering value to our customers, whatever the context.”
