Bureau Veritas in £450m deal for Inspectorate

City A.M. Reporter
FRENCH certification company Bureau Veritas has agreed to buy commodities testing and inspection firm Inspectorate for £450m.

The purchase from UK-based Inspicio, majority owned by private equity firm 3i Group will put Bureau Veritas among the top three companies in a global market worth more than €5bn (£4.2bn), Bureau Veritas.

"Bureau Veritas now attains a critical size in the very promising commodities testing and inspection market," Chief Executive Frank Piedelievre said in a statement.

"We are extending our business portfolio and bolstering our international network in the US and most emerging economies."

Piedelievre has said he wanted to pursue acquisitions more aggressively this year, enabling the group to increase its range of services and expand abroad.

Inspectorate, which has 150 laboratories in 60 countries and over 7,000 staff, has doubled revenue since 2006 to £246m in 2009, Bureau Veritas said.

The aim was to improve its operating margins to the French group's level mid-term.

Bureau Veritas said it would fund the acquisition via existing and newly negotiated credit lines and that net debt would reach around two times earnings before interest, tax, depreciation and amortisation after the deal.

The purchase would boost adjusted net profit by about three per cent this year and four per cent next year, excluding synergies, which would be "substantial," Piedelievre said.
The deal is expected to be completed by September.