Sale, Arval UK chief executive officer Benoit Dilly has described his company’s acquisition of GE Capital Fleet Services as “a perfect fit”.
Talking to Fleet News in his first interview since the deal was confirmed (read more), Dilly said: “Our growth has been from SME in the last few years and we are back to growth in our corporate business as well. They are focusing in the mid-market but not the biggest customers. It complements what we are doing – it’s a perfect fit.”
The combined business - which adds 28,000 GE vehicles, primarily cars, to Arval’s 110,000 (FN50 2015 figure) to create a risk fleet of 138,000 vehicles - will continue to seek opportunities to grow, even during the integration process, according to Dilly. The balance will remain with GE Capital UK's equipment finance division.
His original aspiration of creating a business with a market share of 8-10% (read our spotlight feature here) was because he believed that level of scale was needed to become a significant player in the UK.
“I don’t see any reason to re-set my ambitions. Our ambition is to continue growing at a reasonable pace and there are opportunities,” he added.
“With the GE portfolio we have a more sizeable fleet in corporate but there is room for improvement and growth, even though it is very competitive regarding the demands on service and pricing. But it’s a good market to be in.”
The SME sector remains a key growth target. “There are hundreds of thousands of customers where the penetration of contract hire is very low,” Dilly said.
He added: “We can do better in the way we work with manufacturers – that is part of the strategy we are developing.”
The acquisition was part opportunistic, part strategic, Dilly said. “The opportunity occurred with GE disposing . But also BNP Paribas willingness to grow its specialist activities in Europe.”
Arval is now undertaking a review of both businesses, but is confident that it will retain all customers. The process of engaging with staff at GE’s Sale, Manchester office started last week and all staff are being retained while the integration takes place.
“The first comment which comes to mind is we are talking the same language in terms of service, the ways of addressing customer challenges and to find solutions, which is as a contract hire business,” Dilly said.
“We are discovering each other in terms of staff, managers and people. We are in integration mode in the coming weeks and we will discuss organisational structure including locations in the coming months.”
Gary Killeen, the former GE Capital Fleet Services managing director, will switch across to Arval “in a role as a sales leader” and to work on the integration, while his management team will also stay with the business. The priority is continuity for staff and customers, said Dilly.
“We want to keep customers and we need the staff for that.”
Arval and GE fleet customers should see no change while the integration takes place. Ultimately, Dilly said, they should expect “a better offer and a more reliable organisation” regarding product, relationship management and reporting systems.
“It is very clear that we are pulling two businesses in very good shape – we are not trying to save part of one business with another,” he said.
“They are both strong but we believe there are still ways to improve so that should be the expectation of our customers.”