Global recruitment firm Antal International is returning to the Russian market by acquiring the business it sold nine years ago, bne IntelliNews can reveal.
Tony Goodwin, chief executive of Antal, which operates from 143 offices in 32 countries globally, told bne IntelliNews in May that he was in talks about buying a major local operator and was near to completing a deal. On June 14, he texted to say: “We are buying back Antal [Russia] - our original baby.”
Goodwin left the Russian market after his selling his business in 2008 before the global crisis for several “tens of millions of dollars” to FiveTenGroup, a firm backed by private equity group Englefield Capital. It is understood that Goodwin is paying considerably less to buy the business.
“The market has been in the doldrums for three years and I think the timing is right,” Goodwin said in an interview. “If we leave it till next year, my feeling is that Russia will have already recovered. There is still some pick-up needed but now is the right time to go back, especially as oil prices are improving and general sentiment is up.”
Antal Russia has 115 consultants and a total staff of 130 in Moscow, St Petersburg, Kazan and Almaty in Kazakhstan with annual sales of £8.1mn. The management team consists of Michael Germershausen, Luc Jones and Natalia Kurchi, who all worked with Goodwin before.
Goodwin also offloaded his Polish business in 2013, but has been in an expansionary mode ever since. After the Polish deal, Antal opened new offices in Czech Republic and Slovakia. A Mexico operation was opened in 2013 covering the Central America region and Antal acquired Smart Moves in the UK in 2015 to expand its coverage of blue chips. Most recently, he joined forces with Career International to expand on Antal’s already successful China business.
Antal is hoping to capitalise as several of its competitors have closed down or exited the market since the economy started contracting three years ago.
UK recruitment firm Michael Page closed its office in Moscow at the end of May 2015 after US and European sanctions – imposed after the Kremlin’s annexation of Crimea in 2014 – compounded the decline in commodity prices.
Other global and Russian search firms retrenched as foreign and domestic companies slashed headcounts. German lender Deutsche Bank closed their entire investment banking operations in the wake of a trading scandal, while investment banking rivals took the axe to hundreds of sales, trading and research staff. International energy companies were particularly hard hit by sanctions. Oilfield services giant Schlumberger axed all its expatriate staff as exploration and drilling activities almost ground to a halt.
Goodwin said the Western sanctions had ironically helped some other sectors to stimulate productivity. “Russian manufacturing has benefited from the sanctions,” he said. “I am not saying they are suddenly going to produce a Proctor & Gamble or a Unilever, but there is an increase in ingenuity, productivity and a need to get things done.”
Goodwin hopes to be able to cross-refer existing clients in China and India into the Russia market space as President Vladimir Putin’s much-vaunted “pivot to Asia” gradually gathers pace.
Goodwin said his partner in China, Career International, successfully completed an IPO on June 8 after becoming the largest “Chinese human capital company”.
Goodwin, who hails from Stoke-on-Trent in northern England, started out in emerging markets in 1993 when he spotted the potential for new professional employment markets in the former Warsaw Pact countries and set up his own business named Antal – the Hungarian word for ‘Anthony’.
Since then, Goodwin and his team have developed businesses in emerging markets across the globe, such as Russia, India and China, through a mix of wholly-owned operations, franchises and joint ventures.