8. Feature: 4Service – From startup to industry leader
Private equity-owned companies are inherently destined for eventual sale. This case study explores the remarkable journey of the Norwegian service company 4Service, highlighting its transformative partnership with the PE-fund Norvestor – emerging as their best investment to date.
4Service is a well-established service company that specializes in a wide range of services, including cleaning, hotel management, and cafeteria operations both offshore and on land. With extensive experience in construction sites and large office buildings, they have become a trusted partner in the industry.
Norvestor invested in the company in late 2015, believing in its potential. Founded by four entrepreneurs in 2011, 4Service was a proactive industry challenger with strong growth prospects.
Tor Rønhovde, CEO of 4Service since 2013, states that the largest milestone in the history of 4Service was being sold to Norvestor.
– From then on, the journey shifted from a startup to a company with ambitions for substantial growth, Rønhovde adds.
Norvestor found 4Service interesting because of its challenger role. Partner at Norvestor, and previously chairman of the board at 4Service, Fredrik Korterud elaborates:
– We have had positive experiences investing in 'challenger companies' that compete with established players, and that was also something we saw in 4Service.
– We chose Norvestor because of their team. They made a good impression, and we had good chemistry from the start. As a business focused on people, relationships matter, Rønhovde explains.
Korterud emphasizes the importance of a competent and skilled management team in why Norvestor found 4Service intriguing, and further explains what other factors they liked about the company:
“Facility management is a large market with a lot of business to compete for. The combination of strong organic growth opportunities, business development, and the buy-and-build approach made it easy to see that this company could grow much larger.”
- Fredrik Korterud
Strategic growth through acquisitions
Norvestor had solid plans for developing 4Service through organic growth and strategic acquisitions. A key part of the strategy was preserving the decentralized decision-making structure, giving 4Service the competitive advantage compared to larger organizations. Investment director at Norvestor and previous board member at 4Service, Håvard Berge further explains:
– It required a significant digital upgrade to make information and decision-making foundations accessible, allowing them to maintain decision-making power as far out in the organization as possible.
Norvestor also actively worked on an acquisition strategy, an area where 4Service initially had little experience:
“We shared our expertise with the company and contributed to establishing M&A capabilities within 4Service, responsible for screening and validating opportunities, executing acquisitions, and developing integration plans.”
– Håvard Berge
The acquisition strategy was built on three pillars: service expansion, geographic growth, and scaling.
– We have exclusively concentrated on acquiring companies to facilitate strategic growth, allowing us to expand into new geographical markets and improve our product offerings, Tor Rønhovde explains.
Speed has been crucial in integrating acquired companies, Rønhovde elaborates:
– The strategy has been to carry out integration processes quickly to build a common culture and maintain momentum, with the aim of achieving full integration within three months. The focus has been on rapid co-location because being together is essential for building culture.
This made it possible for 4Service to grow quickly while strengthening its market position. In total, 4Service has made twenty acquisitions, all of them during Norvestor’s ownership period.
Exceptional growth achieved through a company culture based on trust
Through a nine-year ownership period, Norvestor has been a part of an impressive growth journey with 4Service.
– When we signed the purchase, 4Service had a turnover of just over NOK 400 million. In 2024, they had a turnover of more than NOK 5 billion, a more than tenfold increase in revenue, Korterud says.
– We didn’t just tenfold the revenue, but also the number of employees, from slightly over 600 to over 6,500, Berge adds.
“With trust you can grow faster”
A key success factor has been the strong company culture:
– The biggest difference between us and other companies is that we trust our people, and from day one, we’ve had a trust-based leadership model where employees get more trust and responsibility, Rønhovde states.
– Building a strong company culture has been a major priority for Rønhovde and his team, and they have invested significant time and resources in leadership development at all levels, Korterud says.
- With trust, you can grow faster because you can dare to take more actions, Rønhovde explains.
Berge highlights how ESG has not only been a measurement parameter, but a value driver within the company, and that 4Service has taken on a true leadership role of ESG within the industry.
– Rønhovde's approach to ESG has always been 'practical ESG,' ensuring it offers meaningful value, Berge adds.
Norvestor aided in structuring the company’s ESG work.
– Norvestor helped us structure what we were good at but hadn’t fully realized, Rønhovde says. This structured ESG approach has enhanced the company’s competitiveness in securing contracts.
Navigating the pandemic without financial loss
– When everyone works from home, there aren't many open cafeterias left, says Korterud.
Four years after investing in the company, the covid-19 pandemic abruptly challenged the service company. Despite being heavily impacted by the pandemic, 4Service where quick to implement measures.
– The management swiftly acted with furloughs and cost adjustments, Korterud adds. They engaged with customers to manage the situation effectively.
4Service was one of the first actors to start bringing people back from furlough, giving the company an edge over competitors when the market returned to normal.
A strategic and profitable exit
After successfully navigating through the pandemic without financial loss, management and Norvestor began preparing to find a suitable buyer for 4Service. The company had attracted interest from potential buyers over the years, and in 2024 it was deemed the right time to proceed.
– We had a solid field of interested parties and gained good traction during the process. One buyer distinguished itself and was particularly interested, and that was Compass Group, Korterud explains.
“We can reveal that this is Norvestor’s best investment to date”
The growth of 4Service can be broken down into approximately 30% due to acquisitions, while the remaining 70% of the growth is organic.
– A growth journey like we've had with 4Service is quite unique. The company has maintained industry-leading margins and profitability throughout this growth, which is a testament to its success. Usually, there are periods of weaker profitability when growing significantly through acquisitions. In this regard, 4Service’s fast integration has been best in class, Korterud states.
The result was a very profitable exit for Norvestor.
– We can reveal that this is Norvestor’s best investment to date, Korterud says, referring to the multiple of invested capital achieved.
Over the past nine years 4Service has developed into a leading player in the industry. Norvestor's contribution during the ownership period has been crucial in realizing the company's growth, and the transaction with Compass Group marks a successful conclusion to an impressive journey with support from private equity.
When one chapter ends, another begins
As of 2025, Tor Rønhovde is CEO of Compass Group in Norway. Compass Group is the global leader in food services, with 580 thousand employees operating in thirty countries.
His goals for the company are as ambitious as before:
– My goal moving forward is that we will leverage the global strengths of Compass Group along with all the strengths that little 4Service brought. I truly believe that the synergy presents a significant opportunity for further enhancement of our services, Rønhovde concludes.