FRENCH CONTRACTOR Fressinet has bought for an undisclosed sum geotechnical contractor Terre Arme International (Group TAI), the French company that developed Reinforced Earth.
This strengthens Fressinet's position in the international geotechnical market, and gives it an established dealer network in the US, through which Fressinet hopes to get a foothold in the lucrative US bridge post- tensioning market.
Fressinet president and CEO Jean-Pierre Marchand-Arpoume says the two companies have complementary dealer networks, essentially similar client bases, and both carry out 'high added value activities'. Fressinet says it will continue to use both company names and will operate a strict policy of not mixing product brands and company identities.
Streamlining management and administration while rationalising the dealer network will bring cost savings, but increase the coverage of both operations, Fressinet believes.
Marchand-Arpoume says it is difficult for a company of Group TAI's size to sustain what is essentially a single product line that requires a large international distribution network. Group TAI's largest single market, the US, last year turned over £4M, only 7% of the company's worldwide revenue of £60M. Combined turnover for the two companies is targeted at £220M, with a profit of £2.5M.
Group TAI developed and commercialised Reinforced Earth in the 1960s and today claims to be world leader in what have become known as mechanically stabilised earth structures, with about 60% of the world market. However the company suffered commercially in the early to mid-1990s when the patents covering the technique expired and the reinforced soil market opened up to competition. Last year saw the group break even after a number of loss- making years.
Group TAI director Roger Warwick estimates mechanically stabilised earth to account for about 10% of the worldwide retaining structure/embankment market, but expects its use to increase significantly in the next few years. The injection of capital from Fressinet should help development of the market and keep Reinforced Earth as the leading brand within it, he believes.