AGRR Magazine

Purchase of Safelite by Belron May Be Imminent

While no one will go on the record, a number of sources from different outlets who are extremely reliable have told glassbytes.com™ that a purchase of Safelite Glass Corporation by international behemoth Belron may be in the works and could be announced as early as this week.

Such a purchase would be a crowning victory for the multinational corporation that provides auto glass replacement services in approximately 30 countries around the world. It had owned a minority position in Safelite 6 years ago that, by all accounts, did not prove successful. "Fundamentally, the problem was that Belron was a minority shareholder in the company [Safelite]," said Belron CEO Gary Lubner in an interview with AGRR magazine in 2004. "That was a unique position for us to have. It will never happen again," he vowed.

Belron has been aggressive in its acquisitions in the United States during the past few years, having purchased Elite Auto Glass headquartered in Denver, Auto Glass Specialists in Wisconsin and Maverick Glass in Arizona, among others. While those acquisitions gave the company a good taste of the installation side of the auto glass business in the states, all were regional in nature.

"Belron needs two things in the states that it doesn't yet have," said one industry expert who preferred anonymity. "It needs a strong presence in every state, so that it may attract more large national insurance companies as customers, and it needs a third party claims administration (TPA) arm in order to do so as well. An acquisition of all Safelite-related companies would give them that."

Should a purchase of Safelite by Belron occur, it would drastically change the landscape of the auto glass business in the United States over time. One of the keys to Belron's success in other countries is its national branding. "In the United States, there are pockets around the country where auto glass companies have down an excellent job of branding. But, with the possible exception of Glass Doctor, no one has attempted to brand on a national basis," said our expert. "Belron has been very successful at creating a national brand."

"When you ask people in some places in Europe where they would go to have their windshield replaced," most would say our company," said Lubner in the AGRR interview. "We created that awareness. We built it by investment. No one in the States has that, and the country is so large it would be difficult to create."

Belron will face another challenge as well. In most countries, it does all installation work itself and does not subcontract work to independent companies in its "network." Safelite does so. More than the insurance interface, this may be the challenge for Belron on a national basis in the U.S.

Of course, there is always the possibility in potential acquisitions such as this, that the deal is not consummated and no such acquisition occurs.

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