3i Group Share News (III)

By Ambroise Ecorcheville Of DOW JONES NEWSWIRES PARIS (Dow Jones)--Certification services company Bureau Veritas (BVI.FR) said Tuesday it has bought U.K. peer Inspectorate for GBP540 million, and plans to improve its operating margin in three-to-five years, bringing it to the parent company's level. The acquisition of Inspectorate, from U.K. company Inspicio which is majority-owned by private equity firm 3i (III.LN) and funds managed by 3i, will transform Bureau Veritas into one of the world leaders in commodities testing and inspection. It will employ 46,000 people in more than 140 countries. The transaction is expected to be completed during the third quarter, on clearance from the relevant competition authorities, Bureau Veritas said. If the acquisition is approved, the group's revenue will increase to around EUR3 billion, the company said, without providing further financial details. In 2009, Inspectorate posted revenue of EUR280 million, with a 7% increase in organic growth. Bureau Veritas expects its net debt to rise to twice its earnings before interest, tax, depreciation and amortization, or Ebitda, following the acquisition. It also forecasts a full-year accretive impact of about 3% in 2010 and 4% in 2011, excluding synergies. The transaction will allow for commercial and costs synergies the group didn't detail so far. "Inspectorate is for now less profitable than Bureau Veritas," Bureau Veritas Chairman and Chief Executive Frank Piedelievre said, as its operating margin is currently between 10% to 11%, while Bureau Veritas' operating ùargin stands at around 16%. Consolidating Inspectorate will consequently lower Bureau Veritas' operating margin this year, Piedelievre noted. The group could still make further small acquisitions this year and will have room for manoeuver for more possible buys next year, Piedelievre told Dow Jones Newswires. - By Ambroise Ecorcheville; +33 1 40171740; ambroise.ecorcheville@dowjones.com (END) Dow Jones Newswires June 22, 2010 05:15 ET (09:15 GMT)