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Consolidation in Sweden positive for Opus

logoLast Friday, April 8th, Swedish vehicle inspection company Besikta announced the acquisition of competitor Clearcar (80 inspection stations) for SEK 40m. Following the deal, Besikta will have a market share of around 27%, making it the second biggest player in Sweden together with Opus (also 27% mkt share). The top 3 players Bilprovningen (30%), Opus (27%) and Besikta (27%), do now have almost 90% of the Swedish vehicle inspection market.

In an interview with a Swedish news agency, Opus CEO Magnus Greko says that a consolidation of the industry was expected. “Obviously, we have also been looking at Clearcar, but we decided to pass on this one. We are the most profitable player in the industry and want to keep it that way.”

In February 2016, Clearcar saw its accreditation withdrawn by control agency Swedac, who had found serious flaws in the inspection operations. Following an appeal, Clearcar received a temporary license.

We believe it would be quite a handful to straighten Clearcar’s business out. We are also skeptical towards their one-lane-stations served by one technician“, says CEO Greko, who does not want to comment on the price level. Opus focuses on bigger stations, with at least two lanes and several employees at each station.

We think it is more efficient this way and also easier to ensure high quality and give customers a better service.” CEO Greko does not exclude the acquisition of a competitor in general. “Today there are six bigger companies (in Sweden), of which three are profitable. With this deal, the amount has decreased to five. I believe mid-to long-term there will be three to four players left.”

 

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