18/02/2009 - SPB takes a stake in expert brokers O2M

In 2008 SPB made significant inroads into the 'breakdown' insurance market for electrical equipment such as flat screen TVs, laptops, games consoles and so on. Already a market leader in France and Europe for 'damage' and 'theft' insurance for electrical equipment, 2008 saw SPB enter into some major partnerships for providing extended warranties with high-volume retailers such as Fnac, Carrefour, Surcouf, Game, Rue du Commerce, and others.

Jean-Marie Guian explains: "Becoming a stakeholder in O2M gives SPB a strategic foothold in the value chain of extended warranties. In view of the development of this market, the importance of clean recycling of these products during and at the end of their life cycle, and the impact of this phase in the economic models of our insurance partners, it had become important for us to make these processes secure and tighten our relationship with this strategic partner."

SPB had been working with O2M for two years prior to taking a stake in the business, notably for their expertise in fault analysis and recycling mobile telephones on behalf of insurers (60,000 telephones were recycled in 2008).  In the future O2M will be accompanying SPB's development into the international extended warranties market. Director Alexis de Barrau gives more details: "Indeed, over the last fifteen years O2M has acquired a reputation for competence in the French and European market not only for our capacity to market stocks that manufacturers want to clear from their inventories but also for undertaking audits and buy-backs of all kinds of equipment pools (computers, multimedia devices, telephones) on behalf of leasers operating in Europe."

In addition this alliance will give O2M the support of a solid player in the industry, accelerate the development of its traditional business and allow O2M to take on new products or new markets, especially in the international arena.

A deliberate strategy of external growth

The agreement, which was signed on Thursday 11th February and sets the foundations for a sustainable partnership between the current management teams, provides for a gradual increase in SPB's shareholding until the company becomes a majority shareholder by July 2010.

This comes at a time when SPB recently took control of the Paris-based brokers D&P Affinity, IFEBO and AVI. These three companies operate in the bespoke insurance industry and thus provide SPB with some interesting opportunities.

These acquisitions reflect the policy of external growth which SPB implemented in 2008. Other opportunities are being looked into, both in France and Europe, with the focus on small and medium-sized organizations.