Bureau Veritas Sa Business Information, Profile, and History

Company Perspectives:

Vision: Become the leader in our industry and a major player in each of our market segments and key geographical market. Mission: Bureau Veritas's mission is to help its customers to manage their assets, products, services, systems, and employees whilst creating added economic value through risk management and performance optimization.

History of Bureau Veritas Sa

Bureau Veritas SA is one of the world's leading companies providing QHSE (Quality, Health, Safety, and Environmental) testing, certification, and management services. The company's services range from its historic core of marine certification to consumer goods testing services to building and facilities inspection and certification and government services and industrial services. Based in the La Defense office park in Paris, France, Bureau Veritas is also one of that country's most international companies, with more than 550 offices and laboratories operating in more than 140 countries. The company's total customer base numbers more than 200,000, served through six geographically defined primary divisions: North America, Latin America, Europe, France, Africa, and Asia and the Middle East. France remains the company's single largest market, at 39 percent of sales; Europe adds nearly 20 percent to the company's total sales--which topped EUR 1 billion for the first time in 2002--while the Americas add another 20 percent to sales. Bureau Veritas has put on hold plans to go public at the turn of the century: principal shareholders remain Poincare Investissements and CGIP, which each hold the 32.6 percent of the company; individual shareholders, including members of the founding families, hold another 31 percent of the company.

Ship Insurance Certification in the 19th Century

Bureau Veritas evolved into one of the world's leading testing and certification companies in the 20th century. Veritas's roots, however, stemmed from the early part of the 19th century. The rise of international shipping routes and the growing numbers of private vessels plying the world's oceans corresponded with the development of the rise of the marine insurance industry. Insurers in turn required information about the vessels they were asked to insure in order to properly assess a vessel's insurance risk. While the forerunner to Lloyd's Register, which was long to remain Bureau Veritas's chief rival, had been publishing a ships' register since the mid-18th century, the European continent lacked a similar service.

In 1828, Louis van den Broek, Alexandre Delaye, and August Morel recognized the opportunity to set up an assessment service on the European continent, opening an office in Antwerp. Initially called Information Bureau for Maritime Insurers, the company's original motto--"to seek out the truth and tell it without fear or favor"--provided the basis for the name Bureau Veritas, adopted in 1829.

Bureau Veritas provided assessment services as to a vessel's seaworthiness, as well as the condition of its equipment and the quality of its crew. Insurers quickly picked up on the service, and by 1830 Bureau Veritas had already compiled a register of more than 10,000 vessels. In that year, the company opened an office in Paris. Two years later, Paris became the site of Bureau Veritas's headquarters.

Throughout the remainder of the 19th century, Bureau Veritas focused on its maritime market. By the turn of the century, however, the company had recognized that growing industrialization had given rise to similar quality, health, and safety assessment services among the world's industries. By 1910, those activities had grown sufficiently for the company to form a dedicated Industrial Division. That division was later to become the company's most important, accounting for more than a third of sales at the beginning of the 21st century.

Bureau Veritas became an officially recognized certification body for the French government. In 1922, the government turned over the assessment and certification of the country's aircraft, prompting Bureau Veritas to form a new dedicated Aeronautics Division. By the end of that decade, Bureau Veritas had created another dedicated division for the construction market, creating the Building and Facilities division in 1929.

Following World War II, Bureau Veritas's organization began to take on a more corporate form as the company's activities extended to include a wide range of consulting and engineering services. In the early 1980s, Bureau Veritas took a step closer toward adopting a full corporate model, regrouping a number of its activities into dedicated subsidiaries, starting in 1984. One of the first of these was its Contrats de Gouvernement unit, which took over the company's government services operations. In 1985, the company created Tecnitas, a subsidiary dedicated to the marine and offshore industries.

In 1986, the company created Véridatas, a subsidiary specialized in computer security applications. Two years later, Bureau Veritas spun off its certification operations into a dedicated subsidiary, Bureau Veritas Quality International (BVQI). That year, the company made two acquisitions as well, buying up Assistance Technique Aéronautique (ASII) and PKB.

Expansion in the New Century

By the beginning of the 1990s, Bureau Veritas had expanded into another area, that of the French automobile inspection market, building a nationally operating chain of inspection centers. In 1990, the company created a dedicated subsidiary for its automobile inspection activities, regrouped under the name Véritas Auto. Then, in 1994, the company formed a joint venture with another leading automobile inspection group, Dekra, forming Dekra-Veritas SA. The combined operation featured more than 1,100 inspection centers throughout France.

In 1996, Bureau Veritas paid FFr155 million to acquire fellow French company CEP (Controle et Prevention), the country's leading provider of building survey and industrial inspection services. In that year, also, Bureau Véritas found new owners, when investment firms CGIP and Poincare Investissements bought out majority control of the company from its founding families. The new owners, which each controlled 32.6 percent of the company, then began preparations for taking Bureau Veritas public in 1998. However, the volatility of international stock markets that year forced the company to put its IPO on hold, if only temporarily.

In the meantime, Bureau Veritas began something of a spending spree at the turn of the century. In 1998, the company acquired ACTS Testing Labs, based in Buffalo, New York. The acquisition enabled Bureau Véritas to enter a new business market, that of consumer goods testing. The following year, Bureau Veritas made three more acquisitions, those of ATL Consulting Group Ltd., a UK-based engineering and management consulting company, and the U.S. firm of Unicon International, together with its subsidiary Neptunus, adding their specialized operations in the logistics and transportation markets.

Bureau Veritas's acquisition drive continued into 2000 with the purchases of Bio-Control, which specialized in the inspection of hospital equipment, and Germany's DASAzert, which had formerly operated as the aerospace certification body of Daimler Chrysler. In 2000, also, Bureau Veritas created a new division providing e-commerce certification services. The following year, the company boosted its aerospace component with the acquisition of a 70 percent share in the Raytheon's aerospace division.

Bureau Veritas sought a far larger prize in 2000 when it began a bid for Italian rival RINA (Registro Italiano Navale), which was then in negotiations with the American Bureau of Shipping. The company had also been making overtures to another rival, Germanischer Lloyd, with the possibility of forming, together with RINA, a European classification "supersociety." By February 2001, the company appeared to have worked out a merger agreement with RINA. In the end, however, talks with both RINA and Germanischer Lloyd broke down.

Bureau Veritas began looking elsewhere for acquisition possibilities. Thwarted in its attempt to build up its ships' registry wing, the company instead continued to broaden its range of activities. In 2001, the company purchased Merchandising Testing Laboratories, based in Amherst, Massachusetts. That company specialized in textile testing services and was combined with ACTS in 2002 to form MTL-ACTS.

In December 2001, Bureau Veritas purchased Plant Safety Ltd., an industrial inspection subsidiary of the UK's CGNU Plc. By then, the company had also made another significant acquisition, that of Laboratoire Centrale des Industries Electriques (LCIE). Founded in 1881, that company had grown to become the top French testing and certification body for the electrical and electronics industries.

Bureau Veritas paused in its acquisition drive at the beginning of 2002. By the mid-2002, however, the company had completed the first of four new acquisitions for the year--Germany's IPM (Ingenieurgesellschaft für Projektmanagement GmbH), which operated in the project management field. Next, Bureau Veritas paid some $83 million to acquire US Laboratories Inc., which provided quality control services to the construction, public works, defense, and aerospace industries, as well as related architectural and engineering services. The company also completed its acquisition of Regspec, a subsidiary of National Britannia, based in the United Kingdom, which specialized in the electrical safety market.

The company completed its acquisitions for 2002 with the purchase of Aquarism, a small French company set up in 1998 that specialized in inspections and quality control of water supply systems and other water engineering projects. Nevertheless, Bureau Veritas showed no signs of slowing down its external growth. In January 2003, the company added its latest acquisition, that of DIN VSB ZERT Zertifizierungsgeseelschaft GmbH, a German specialist in the railway sector. By then, Bureau Veritas had grown into one of France's most internationally operating companies, with subsidiaries in more than 140 countries and revenues topping EUR 1 billion.

Principal Subsidiaries: Bivac International; Tecnitas; MTL-ACTS; LCIE; CEP Industrie; Plant Safety Ltd.; Qualité France; Transcable; Unicon.

Principal Divisions: Industrial; Aeronautics; Building and Facilities.

Principal Competitors: Lloyd's Register of Shipping; Det Norske Veritas; American Bureau of Shipping; Registro Italiano Navale; Fortis NV.

Chronology

• Key Dates:
• 1828: Information Bureau for Maritime Insurers set up in Antwerp to provide ship assessments for maritime insurance agencies.
• 1829: The company adopts the name of Bureau Veritas.
• 1832: Company headquarters move to Paris.
• 1910: An Industrial Division is formed.
• 1922: An Aeronautics Division is formed and takes over the aircraft certification concession for the French government.
• 1984: Bureau Veritas begins spinning off operations into subsidiaries, starting with government contracts operations.
• 1985: Tecnitas, a subsidiary dedicated to marine and offshore industries, is formed.
• 1986: Veritdatas, a specialist in computer security, is created.
• 1990: Veritas Auto is created to take over the company's automobile inspection operations.
• 1994: Veritas Auto is merged with the automobile inspection operations of Dekra, forming Dekra-Veritas.
• 1996: CGIP and Poincare Investissement acquire majority control of Bureau Veritas.
• 1998: ACTS Testing Labs of the United States is acquired.
• 2002: MTL and ACTS are merged to form MTL-ACTS; the company acquires IPM (Germany), Regspec (U.K.), US Laboratories Inc. (U.S.), and Aquarism (France).