Belron International Ltd. - Company Profile, Information, Business Description, History, Background Information on Belron International Ltd.

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Our vision is to be the world's No. 1 choice for vehicle glass.

History of Belron International Ltd.

Belron International Ltd. is the world's leading provider of vehicle glass repair and replacement (VGRR) services. The company operates a network of more than 1,300 glass replacement service centers, backed up by a mobile repair fleet of nearly 4,000 vehicles. Belron is a hol ding company overseeing several brand names, including the company's flagship brand Carglass, present in some 20 countries, primarily in E urope. Other brands include Autoglass (United Kingdom, Ireland, and P oland); O'Brien (Australia); Hurtigruta (Norway); Smith & Smith ( New Zealand); and, since 2005, the Elite Auto Glass, Auto Glass Speci alists, and GlasPro brands in the United States. Altogether, Belron o perates in 27 countries; the company directly oversees its operations in 19 countries and has put into place franchise networks in nine co untries. Belron also supports its VGRR operations with its own resear ch and development arm, which has been developing a new windshield re moval system in the 2000s. Belron is a subsidiary of Belgian automoti ve distribution giant D'Ieteren N.V., which is also a major sharehold er in Avis Europe. D'Ieteren holds nearly 75 percent of Belron, which is registered in Luxembourg and headquartered in the United Kingdom. In 2004, Belron's revenues reached EUR 1.12 billion ($1.5 billio n).

South African Plate Glass Specialist in the Early 20th Century

The origins of Belron lay in the South African glass and furniture in dustries at the turn of the 20th century. The earliest part of the gr oup was founded in 1896 by Ernest Beardmore, who emigrated to South A frica from England and set up the Plate Glass Bevelling & Silveri ng Company in Cape Town. Beardmore's company specialized in decorativ e glass work and in producing mirrored glass. Into the new century, h owever, Beardmore faced growing competition, particularly from City G lass. That company had been established by Adolph Brodie, a Lithuania n native who had emigrated to England in the 1880s, before coming to South Africa in 1903. Brodie launched City Glass in 1909.

City Glass grew quickly, and overtook Beardmore's Plate Glass company . From rivals, Brodie and Beardmore quickly became friends, and towar d the end of World War I decided to merge their companies in 1917. Br odie then bought out Beardmore, and brought his three sons into the b usiness. Following the merger, the Brodies changed the name of their own company to Plate Glass Bevelling & Silvering Company. The com pany then began to expand into other South African markets, establish ing branches in several towns.

Each of the Brodie brothers was assigned a branch, with Emmanuel Brod ie operating the Cape Town branch, and Harry Brodie placed in charge of a branch in Port Elizabeth. A third Brodie brother, Jackie, was se nt to Johannesburg to open a company branch there. However, as Ronnie Lubner, future Belron chairman, told Business Times: "Jackie' s heart was never in it and the brothers came to Johannesburg to find a replacement."

Instead, the company took on Morris Lubner as a part-time agent. Lubn er quickly proved himself an industrious salesman, and by 1922 had be en taken on as a partner in the Johannesburg branch. Lubner expanded the operation, moving it to new premises. Lubner also was responsible for the company's first diversification, adding plywood and lumber s ales in the 1920s.

A more significant diversification for the later Belron company came in the late 1920s. The Ford and General Motors companies had come to South Africa and had set up their first factories in Port Elizabeth. Emmanuel Brodie recognized an opportunity to expand the company's gla ss business, and convinced both U.S. automakers to purchase their win dshields from Plate Glass Bevelling & Silvering. In 1927, the com pany set up a division specialized in the production and sale of wind shields and other automotive windows.

The company began producing its first safety glass in 1931, a move dr iven by Harry Brodie, who went to England to acquire the manufacturin g rights to the new windshield type, called Shatterproof. As Ronnie L ubner recalled in Business Times: "It was an early example of built-in obsolescence, because the original design was a film of cell uloid between two thin plates of glass which soon yellowed." The Brod ies built their own factory in Port Elizabeth and began producing saf ety glass for the South African automotive industry, under the Afrika nerized name Shatterprufe.

Adolph Brodie died in 1934, and the company was taken over in a three -way partnership among Emmanuel and Harry Brodie and Morris Lubner. I n 1940, the company decided to step up its plywood and lumber busines s, and bought up rival Plywoods of Parow, which became known as PG Bi son. In 1947, the Brodies and Lubner took their company public, listi ng it on the Johannesburg Stock Exchange as Plate Glass & Shatter prufe Industries (PGSI). The company adapted to the change in safety glass technology, developing its own molding process for the new heat -toughened armorplate standard (which replaced laminated glass) in pa rtnership with Triplex Safety Glass in England. The new glass type ma rked an important step into the windshield's emergence as an importan t structural element in modern automobile design. In 1953, the compan y acquired the rights to a new process for producing curved windshiel ds.

Morris Lubner became chairman of the company after Emmanuel Brodie's death in 1961. Lubner had by then brought his own sons, Ronald and Be rnard, into the business. Ronald Lubner became especially involved in PGSI's automotive glass arm. In 1958, the company developed its own laminated glass for rear windshields. In the early 1960s, the company spotted a new expansion opportunity: the vehicle glass repair and re placement, known as VGRR in the trade, the basis of the later Belron company.

In 1962, Ronald Lubner convinced his father to buy up a fast-growing glass company, Express Glass. That company posed an increasing threat to PGSI's own operation, especially in that it had established a nat ionally operating chain of 67 vehicle glass replacement shops. Disput es among the family owners, however, had slowed Express Glass's growt h into the early 1960s. PGSI took advantage of the disagreement over the company's management direction to step in with a buyout offer in 1962.

International Focus in the 1980s

Through the 1960s, PGSI solidified its position as South Africa's lea ding VGRR company. By the beginning of the 1970s, the company then tu rned its interest toward the international market. PGSI took a first step in 1971, when it bought up the Australia VGGR group, O'Brien. Ov er the next decades, that brand emerged as the leader in Australia's vehicle glass market. Another early international market for the comp any was the United States. Rather than establishing a direct presence in the United States, however, the company entry came as an export s upplier of windshields and vehicle glass for the Japanese auto indust ry, as it began its push into the U.S. market in the 1970s.

PGSI restructured its operations at the beginning of the 1980s, separ ating its plywood/wood and vehicle glass operations into two core div isions. The company then renamed its vehicle glass interests outside of South Africa as Solaglass in 1982. The following year, however, PG SI's international vehicle glass business took a big step forward whe n the company acquired two VGGR specialists in the United Kingdom, Wi ndshields and Autoglass. The company kept the Autoglass brand name, d eveloping it into the leader in the United Kingdom and in Ireland.

An important milestone for the company came in 1983, when PGSI agreed to merge its vehicle glass manufacturing operations with that of its primary glass supplier, Pilkington Glass, forming Glass South Africa . PGSI's next major growth move came in 1988, when it acquired Cargla ss. That business provided the company with a springboard for expansi on into the Benelux market, as well as in France and Germany. In addi tion to its own network of VGRR service shops, Carglass had launched a mobile repair and replacement service, building up a fleet of vehic les. Carglass became the most international of the later Belron group 's brands, serving as its primary brand on the European continent.

PGSI acquired full control of Glass South Africa in 1992. In that sam e year, South African Breweries (SAB) acquired a majority stake in PG SI itself. The Lubner family retained some 22 percent of the company as well as directional control, while the financial backing of SAB en abled PGSI to step up its expansion efforts. In 1994, the company reg rouped its international VGRR businesses under a new holding company, Belron International.

The company's expansion hopes focused on the United States in the 199 0s. In 1990, the company made its first effort to penetrate that mark et directly, founding a new subsidiary, Windshields, starting with 25 service shops. In the mid-1990s, however, the newly named Belron sou ght a different approach to achieving scale in the United States. In 1996, the company agreed to merge its Windshields operation into the VGRR business owned by Vistar Inc., in exchange for a 51 percent shar e of Vistar. The merged entity now boasted a network of more than 250 VGRR shops, and a 12 percent market share.

Belron appeared to have hit the big time in the United States by the end of the decade. In 1998, the company convinced rival U.S. autoglas s group Safelite to merge the two companies' operations. Belron's sta ke in the newly enlarged Safelite stood at nearly 45 percent, while S afelite, with a 25 percent share of the U.S. VGRR market and sales of nearly $1 billion, emerged as the clear market leader.

In the meantime, Belron had been expanding its business elsewhere, to o, buying operations in Spain and New Zealand at a total cost of &#36 ;71 million. The company also entered Canada, buying up two of that c ountry's leading VGRR specialists for $98 million.

SAB's decision to refocus its operations around a core of beverage pr oduction and hotel and leisure operations placed Belron on the market in the late 1990s. Belgium's D'Ieteren, the country's leading automo bile distributor and a major shareholder in Avis Europe, bought PGSI in 1999, and then shed the group's non-auto glass operations, keeping only the Belron International business.

World Leader in the 21st Century

Soon after the D'Ieteren purchase, Belron sold off its stake in Safel ite, which had begun to experience financial problems at the dawn of the 21st century. Instead, Belron turned its focus toward expanding i ts European presence, particularly under its Carglass flagship. As pa rt of that effort, the company launched a series of acquisitions, suc h as the purchase of GTC Glaslinien A/S in Denmark in 2001. The follo wing year, the company acquired Darma SpA in Italy, as well as a VGRR specialist in Sweden. Then, in 2003, the company acquired Norway's H urtigruta.

Another significant part of the group's expansion was the launch of a new Carglass franchise operation for selected markets. Greece became the first country targeted for Carglass franchises in 2001, followed by the Czech Republic, Israel, and Slovenia in 2002. By 2003, the co mpany had added franchises in Poland (under the Autoglass name) and S erbia-Montenegro.

Belron's ambitions continued to grow toward the mid-2000s. The compan y added a new acquisition in Italy, buying up that country's second l argest VGRR group. Belron also added to its Norwegian business that y ear. In 2005, the company entered the Hungarian market, forming a fra nchise agreement with that country's Pneutrade Service, a specialist in tire replacement.

The year 2005 marked Belron's return to the United States, and the ex pansion of its North American operations in general. In March 2005, B elron reached an agreement to acquire two Colorado-based companies, E lite Auto Glass Inc. and Glaspro Inc., giving the company a combined 31 branches operating in the western regions of the United States. Th e company next turned to Canada, buying TCG International, based in B ritish Columbia in September 2005. In that month, as well, Belron boo sted its new U.S. position with an agreement to purchase Wisconsin's Auto Glass Specialists. One month later, Belron added new operations in California through the acquisition of Windshield Pros there. By th en, Belron's international network boasted more than 1,300 shops in 2 8 countries. With revenues of more than EUR 1.3 billion ($1.5 bil lion), Belron remained the world's leading VGRR specialist.

Principal Subsidiaries: Elite Auto Glass Inc. (United States); GlasPro Inc. (United States); Hurtigruta (Norway); Lebeau (Canada); O'Brien (Australia); Smith & Smith (New Zealand).

Principal Competitors: Automotive Products Ltd.; Auto Glass Sp ecialists Inc.; Safelite Glass Corporation; Saint Gobain Sekurit Deut schland GmbH and Company KG; Glassworks Plus Inc.; Botzaris Automobil es; Highway Emergency Services Ltd.; MidAmerican Auto Glass.


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