Tough play leaves partners adrift
In the brutal and hard world of AV integration, Pro AV Solutions stood out. A network of independently owned firms, each had a state territory, and each worked as a national network, with mostly national clients.
Some 250 staff delivered the goods around the clock, designing and commissioning complex AV solutions. The directors all sat together on a board, sharing common interests and working to a single objective.
Until Engie came along, and filleted off the largest operator, Victoria’s IBS AV (Aust) Pty Ltd, trading as Pro AV Solutions Victoria.
One recent morning the owners of all the other state operations woke up to discover that what was Pro AV Solutions Victoria was now Engie Services AV Technologies. Worse still, their former partner not only sold his business to the enormous multinational with interests in all kinds of technologies, he was now fronting the new national AV business!
Ian Ward deserved a good outcome when he sold his company, and it was certainly successful. Employing over 90, it was well managed and well respected. He was however nervous when he spoke to CX, and armed with a scripted response to our anticipated questions, supplied by Andrew Turner, an Engie spokesperson.
CX wanted to understand how Engie had purchased his operation alone, and not the rest of the Pro AV Solutions network. He did not wish to discuss this. Instead, he read out things, like:
“I had a longstanding relationship and trusted mutual industry contacts with DESA Australia and became aware of the very positive experience DESA had in joining ENGIE Services in late 2015, as well as the growth opportunities that gave their staff, customers and suppliers.”
On this he is referring to DESA Australia which does Electrica, Data Cabling and Voice Solutions, among less exciting things. With 400 staff that company was bought by Engie a few years ago.
Ian continued in a monotone, reading from his notes: “It was clear that joining the ENGIE Group would open up similar exciting opportunities for my staff, customers and suppliers. Looking forward, we plan to combine the AV Technologies offering with the other ENGIE Services businesses……”
He was prepared to continue, we decided it would be less painful if he emailed me the notes.
It transpires that the deal was done without referral to the national partnership. There was a legally binding agreement between the partners to prevent any partner competing outside their territory, and indeed with provisions for first rights of refusal should one wish to sell.
The Engie deal somehow sidestepped all of this, and delivered the French company a much cheaper operating footprint than had they bought the group. They now have the intellectual assets of IBS AV, 90 trained staff, and a national network of DESA offices which delivers a national AV integrator almost immediately.
Ian Ward stays on as Managing Director of ENGIE Services, AV Technologies, and has the exciting challenge of ramping up the business across Australia and competing against his former partners.
For their part, the partners are seeking a solution to the yawing gap in their network. They will continue to work with Ian Ward, since many contracts in this industry run for years as projects mature.
While no one is on the record, CX understands there is dismay and hurt in play here, and a new landscape emerging that has locally owned businesses pitted against a voracious multinational that currently turns over $96 billion dollars.