Bureau Veritas pursues external growth strategy with the acquisition of TMC Marine

Neuilly-sur-Seine, France, May 04, 2016 – Bureau Veritas has reinforced its position in value-added marine services with the acquisition of leading international consultancy TMC Marine Ltd.

TMC has been providing pre and post casualty advice and support to the marine industry since 1979. The business focuses on marine claims and accident investigations, salvage and wreck removal consultancy and marine expert witness services for a client base that spans P&I clubs, law firms, marine insurers, salvage companies and ship owners.

Headquartered in London, TMC has a network of offices in the US, China, Singapore and Australia. It employs over 50 people and generated revenues of EUR 8.5 million in 2015.

“Our Marine & Offshore business, the historical activity of Bureau Veritas, is one of our eight key growth initiatives to 2020. As such, it is evolving rapidly. We are diversifying our service portfolio and developing our technological leadership in order to meet all our clients’ expectations in risk management. TMC is a recognized brand that enables the Group to enhance its offering to the marine insurance consultancy market, thereby expanding the services that we already provide in offshore to the maritime market,” commented Didier Michaud-Daniel, CEO of Bureau Veritas.

 “We are very happy to be joining the expanding Marine & Offshore division of Bureau Veritas, a leading service provider to the international marine industry. This is a strategic alliance that will provide TMC with technical synergies and greatly enhance the services we can offer to new and existing clients while at the same time continuing our plan of further geographic expansion,” added Tony Bowman, Chairman of TMC.

 http://tmcmarine.com/

About Bureau Veritas

Bureau Veritas is a world leader in laboratory testing, inspection and certification services. Created in 1828, the Group has 66,000 employees in 1,400 offices and laboratories around the globe. Bureau Veritas helps its clients improve their performance by offering services and innovative solutions in order to ensure that their assets, products, infrastructure and processes meet standards and regulations in terms of quality, health and safety, environmental protection and social responsibility.

Bureau Veritas is listed on Euronext Paris and belongs to the Next 20 index.

Compartment A, ISIN code FR 0006174348, stock symbol: BVI.
For more information, visit www.bureauveritas.com

Contacts
Analysts/Investors: Mark Reinhard: +33 (0)1 55 24 77 80 finance.investors@bureauveritas.com	Press: Cathy Pianon: +33 (0)7 71 43 12 96 cathy.pianon@bureauveritas.com Véronique Gielec: +33 (0)1 55 24 76 01 veronique.gielec@bureauveritas.com

Underwriters fall out with expert witness over valuation of fire-damaged vessel

International Transport Intermediaries Club (ITIC) has reported a case in which hull & machinery insurance underwriters instituted proceedings against a marine consultancy firm for alleged negligence in failing to properly review shipyard quotes in respect of the cost of repairing a fire-damaged vessel.

The insured vessel had suffered extensive fire damage. The owners claimed that the ship was a Constructive Total Loss (CTL), alleging that the cost of repairing it was in excess of its insured value. The insurers rejected this claim, maintaining that the vessel was capable of economic repair. The vessel was ultimately scrapped, and the only remaining dispute was over the amount which the insurers were obliged to pay under the policy.

At an early stage, the owners made an offer to settle the claim by accepting $1.136m, plus their legal costs. Underwriters did not accept the offer, and litigation was started by the owners. The underwriters engaged a marine consultancy firm to provide expert advice/evidence on what it would have cost to repair the vessel. The consultants issued a report stating that the vessel was not a CTL. This report was based, among other information, on two independent quotations from Chinese shipyards and detailed calculations from the builder of the vessel which indicated that the steel weight for the vessel’s accommodation block was 312 tonnes.

The owners in turn submitted the report of their technical expert, which had been prepared using a different, ‘newbuild’ approach. This report used an estimated steel weight total of 542 tonnes to repair the accommodation block, and concluded that the total cost of repairing the vessel was $6m, a figure that would have made the vessel a CTL.

Following a joint experts’ meeting, underwriters’ counsel asked the consultants to prepare their own steel weight calculations, inclusive of the accommodation block, in order to rebut the owners’ report. Drawing from their own calculations, the consultants concluded that the shipbuilder’s initial steel weight figure was inaccurate and that the cost of repairing the vessel was about $3.9m in excess of the total insured value. On the basis of this new advice, underwriters settled with the owners for $1.3m, plus the owners’ costs.

Underwriters then started proceedings against the consultants on the basis that they had been negligent in not properly reviewing the shipyard quotes. The underwriters claimed that, had they been properly advised, they would have been able to settle for a lower amount at an earlier stage. This would have reduced their own costs and their liability for the owners’ costs.

The consultants pointed out that the underwriters had rejected the owners’ earlier offer before they had been engaged, and argued that, for their part, they had relied on the figures provided by the underwriters. Moreover, it was not until after the joint experts’ report that they were asked to make their own assessment.

Reporting that the issue was finally settled at mediation, ITIC says, “It is four years since the English Supreme Court held that expert witnesses involved in legal proceedings no longer enjoy protection from liability for negligence. It was a feature of this dispute that there was no document specifying what the consultants had been engaged to do. A large number of disputes involving consultants and other advisers would be avoided if the scope of work was clearly defined beforehand.”

ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com



For more information:
Charlotte Kirk
ITIC
Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com