Convexpert Inc does not fit a truck equipment industry label. The company is more than a truck body manufacturer, more than an upfitter, and not simply a truck equipment manufacturer. From its Laval, Quebec, facility in suburban Montreal, the company does all of the above.
But while ConvExpert does not fill a conventional role in the truck equipment industry, a new private equity company believes the organization fits quite nicely in its portfolio.
ConvExpert is truly a manufacturer and upfitter of specialized vehicles. Founder Pierre Thouin had worked as a designer of ambulances when he decided to start ConvExpert in 1995 in a 5,000-sq-ft facility. The product line expanded quickly to include equipping police cars, electronics vans, high-spec utility trucks, and other specialty trucks and trailers.
When it comes to offering the unusual, the company frequently uses this phrase:
“Everything is possible,” says Bernard Mercier, president of GSE World, the new private equity company that acquired ConvExpert June 1.
A former vice-president of Federal Express responsible for ground support, Mercier knows what it takes to get freight moved quickly and accurately — and commercial trucks play a major role in that. He set up the FedEx operation at Charles de Gaulle Airport in Paris in addition to other locations in Europe and Africa. After a stint with Servisair, a ground support provider, he began thinking about starting his own company because he was not satisfied with what was commercially available.
“Something was missing,” he says. “Because contracts throughout the industry involve 90-day lead times, air carriers (passenger and cargo) wind up having to buy equipment that is available, rather than exactly what they need. We have set out to change that.”
He and his partners had a vision of owning a company that would provide specialized transportation solutions for air and ground-based fleets. They formed a private equity company in 2005 called GSE World to acquire companies such as ConvExpert and bring them under a corporate umbrella to fulfill that vision.
After spending two years doing market research and performing due diligence, GSE World made its first acquisition in December 2007 — a French company that builds specialized cargo handling equipment for airports. ConvExpert was the second. That deal was final June 1.
Attractive acquisition
Several things about ConvExpert put the company on Mercier's short list of organizations he wanted to acquire. Among them:
- Location
Ground support equipment is a global market, but it cannot be shipped very far economically. GSE World now has manufacturing facilities in France and Canada. The company plans to add another facility in Asia soon.
- Reputation
ConvExpert was well-known within its market, particularly among utility fleets in Quebec.
- Products
ConvExpert produces a variety of products that mesh with Mercier's vision of an integrated company.
- Room to expand
The capacity of the present ConvExpert facility will be able to handle the anticipated expansion, not only of the company's traditional products, but new products that are capable of producing more volume and a wider range of products that GSE World plans to introduce.
Ground support equipment
Just as ConvExpert produces specialized vehicles particularly for municipal and utility use, the Canadian operation's sister company in France is doing the same thing for airport applications.
Mercier points out that ground support equipment operates in conditions not found in highway operations. For example, getting under bridges and overpasses is nothing compared to driving close to the wing of an airplane.
While it may not seem like it to airline passengers as they wait for their luggage to come off the belt, things move rather quickly on the other side of the wall. Corporation Groupe Support Equipment, the sister company based in Rochefort, France, produces a vehicle for transporting containers and pallets that fits beneath the wings and has a top speed of 30 kmh. The company's product that most closely resembles an over-the-road medium-duty truck has a deck height that matches that of the main loader, enabling containers and pallets to be loaded and unloaded quickly.
Other ground support equipment that the company manufactures include containers, conveyors, tugs, and portable stairs for loading and unloading passengers where jetways are unavailable.
“We want to offer seven different products in our airport division,” Mercier says. “We will manufacture them and maintain them at the airport. We also will offer full leasing.”
Gearing up in North America
The ConvExpert facility in Canada has plenty of room to expand — to increase production of its own product line in addition to providing GSE World with a manufacturing base in North America.
The company has 160,000 square feet of property, including a plant that covers 76,000 square feet — 2,500 square feet of offices with the balance of the building for production.
ConvExpert moved into its present location — a former Caterpillar dealership — three years ago. To get it ready for increased production, the facility is scheduled to receive a $1 million upgrade, including new layout for the production line and a new ERP system that will use bar codes and scanners to provide accurate control throughout the production process. The plant also is getting a new plasma table and additional welding equipment. Everything is scheduled to be in place by the end of October.
As ConvExpert produces more of its traditional products in addition to the new products for other GSE World companies, the plant will be in production longer each day.
“We only work 70 hours a week now,” Mercier says. “That will change. We already have sold two years of production of the products that we manufacture in Europe.”
The acquisition of ConvExpert by GSE World is part of a larger global strategy.
“We want to acquire three more companies in the next three years,” Mercier says. “The idea is to be able to produce, maintain, and lease products for our customers and to be able to do so faster than anyone else in the business.”
As far as Mercier is concerned, ConvExpert is an important part of an unusual group of companies that he is in the process of assembling.
“Our strategy is to produce specialized vehicles,” Mercier says.
Some, but not all of these specialized vehicles will operate on streets and highways. That's where ConvExpert comes in.