Lloyd’s Focuses on Maritime, Selling its Business Assurance Division
In a move designed to further focus its operations on the maritime sector, Lloyd’s Register announced the sale of its business assurance and inspection services division, including its cyber-security business Nettitude, to Goldman Sachs Asset Management. The world’s first marine classification society, Lloyd’s is calling the transaction a milestone in its strategy to focus on compliance, performance, and sustainability for the maritime industry and broader ocean economy.
According to the company, the transaction will enable it to better support clients as they are confronted by the regulatory, economic, and societal pressures to digitalize and decarbonize. The divestment will allow accelerated investment in the maritime service offering, and with the additional investment capital, the company will pursue growth both organically and through acquisitions to assist maritime clients as they address future risks and opportunities. Reuters is quoting a spokesperson for Lloyd’s as saying the value of the transaction exceeds $100 million.
“For Lloyd’s Register, it comes at a time when there is a pressing need for specialist maritime advisers to guide clients through fundamental change and to help support their digitalization and decarbonization ambitions,” said Nick Brown, Chief Executive of Lloyd’s Register Group. “This transaction builds on our 260-year heritage in the maritime industry and will strengthen our ability to take our compliance offering to the next level, expand our risk and advisory services and develop industry-leading digital solutions. It will also provide greater focus to build LR’s role as a leading industry adviser for maritime supply chain safety, resilience, efficiency, and performance.”
Under its new ownership, Lloyd’s Register’s Business Assurance & Inspection Services division will adopt the brand name LRQA but will continue to provide assurance and inspection services across a wide range of sectors. Goldman Sachs Asset Management intends to expand the LRQA business, helping it to become a leading digitally-enabled assurance provider, partnering with customers across key sectors, geographies, and segments.
“We are at a critical moment in our journey and now is the right time for LRQA to become a fully independent business,” said Paul Butcher, who will be CEO of LRQA. “This transaction will provide the additional focus we need to accelerate our ambition of becoming a leading digitally-enabled assurance provider, at a time when our customers face an increasingly challenging operating landscape. The new ownership structure will help us strengthen our first mover advantage in digital and capitalize on increasing demand for assurance, inspection, and cyber-security services delivered by a trusted provider.”
This transaction marks the latest undertaken as part of a strategic review of Lloyd’s businesses. Last fall, the company sold its energy business unit to London-based investment firm Inspirit Capital. Saying the sale was part of a comprehensive review of LR’s business portfolio and strategic direction, they said the deal would focus Lloyd’s business while creating a new engineering and technical consultancy offering specialist asset performance, risk management, and project management expertise.
The sale of the business assurance division is expected to be completed during the second half of 2021, following antitrust and regulatory approvals.