New Brand for Professional Business; Thales Navigation on the Take-over

On 20th July Thales Navigation announced its take-over by Shah Capital Partners (SCP). GIM International contacted Francois Erceau, vice-president and general manager of the Thales survey and GIS business unit to learn more about the effects of the take-over on Magellan its strategy and future.

What will be the effect of this take-over on the geomatics business?

This is an exciting new phase for the geomatics business and for the entire Thales Navigation business. Moving forward under the ownership of Shah Capital Partners the business will receive the focus and resources needed to succeed in all of its segments, including the survey and GIS business unit. We plan to aggressively execute our strategy to become a leading innovator in positioning and navigation systems for the consumer, survey, GIS and OEM markets. For the geomatics business we will continue to leverage our expertise in higher-end technologies, while taking advantage of the high-volume, low-cost manufacturing afforded us by having a consumer business. For the geomatics customer the result will be high value, highly usable and easy-to-deploy solutions for their business.

Will Magellan Navigation (formerly Thales Navigation) focus fully on the consumer market?

While the consumer market, particular car navigation, was a very attractive market for Shah Capital Partners (SCP) to get into because of the explosive growth in that sector, they were also attracted by the balanced business model of the company. Thales Navigation gains great growth through consumer segments, but also brings steady growth, profitability and market expansion through the survey, GIS and OEM businesses. In addition, we have a rich history of providing high quality, and a unique position in providing high-value solutions for these markets. SCP is committed to capitalising on this core competency and working with management to grow all parts of the business. They plan to bring focus and appropriate resources to compete effectively in the survey and GIS marketplace.

What will be the importance of the professional market relative to the consumer market? Will there be a change in comparison to the current situation?

We expect positive changes in regard to the professional market. Our position on the professional market is a strategic asset that SCP and management plan to further leverage. While rapid growth is expected more in the consumer markets, we recognise there is a great deal of GPS adoption expansion that we can help drive in the GIS and survey markets, and we plan to continue to make this an important part of the business.

Will the take-over have consequences for Magdellan research and development for the professional market?

We expect to focus more resources on appropriate research and development for all of our businesses, including those that serve the professional markets. One of our advantages lies in the fact that we can leverage our R&D activities across multiple businesses. This brings cross-pollination of ideas and development, which is a positive for customers. We have a strong R&D team at the heart of this company and we plan to use that team even more effectively in the future to drive innovation. Both in terms of mode of use of GPS technology by the customer and in terms of how it is configured and packaged to make GPS adoption and use easier for businesses.

Will the take-over affect numbers of Thales Navigation employees and offices?

There are no planned changes in this area. Part of what makes Thales Navigation such a compelling investment for an equity firm like Shah Capital Partners is the people we have assembled over years of experience in the GPS industry.

How did Thales Navigation staff react to news of the take-over?

Employees seem to see it as a very positive development. They recognised that the business was moving farther away from the core focus of the Thales Group and that a more focused shareholder would bring operational expertise and strategic input that could help the company propel its businesses to the next level. They also recognise that, as an independent company, there is a new opportunity to evolve the company and further strengthen it.

What will change first within the professional division of Magellan under the new management?

The most obvious change is that we will have a new brand for the professional business. That will be launched in a couple of months, after the deal closes, and we're very excited to be consolidating the brands of the company under the Magellan umbrella. The exact brand will be revealed around the time of Intergeo. It will be an exciting time for the company, to communicate clearly to the market with a new kind of energy that this is a new dawn and our dealers and customers will benefit from this time of growth.