Bowthorpe plc History
Crawley, West Sussex RH10 2RZ
Telephone: (+44) 1293 528-888
Fax: (+44) 1293 541-905
Incorporated: 1936 as Goodlife Electric Supplies
Sales: £675 million ($1.07 billion) (1999)
Stock Exchanges: London
Ticker Symbol: BWTH.L
NAIC: 33531 Electrical Equipment Manufacturing; 33411 Computer and Peripheral Equipment Manufacturing; 3342 Communications Equipment Manufacturing
We will be the global leader in selected markets by providing creative solutions which improve the performance of customers' complex electrical and electronic systems. We are working towards achieving our objective by focusing on six elements of our strategy: Focusing on high growth markets: Bowthorpe is committed to serving the needs of the world's rapidly developing industries, such as telecoms, aerospace and medical. We will anticipate and respond to customers' requirements by focusing our investment on these areas to create world class solutions; Becoming truly global as a company: To be dependable partners to our customers, we will provide consistently high quality products and support across our operations throughout the Americas, Europe and Asia Pacific; Continuing our entrepreneurial culture: Bowthorpe's ability to remain close to customers and their markets rests in part from our long-established entrepreneurial culture. While the business has grown to become a major international provider of electronic solutions, our flat organisational structure enables our operations to remain fast-moving and responsive; Driving innovation through market foresight: Our five operating groups bring together successful businesses with related technology or shared customers. This enables them to pool expertise and market knowledge to create the most effective, timely and appropriate solutions; Moving up the value chain: We are committed to providing greater added value to our customers, by offering comprehensive system solutions to customers which draw together our expertise in hardware and software; Investing in our people: Attracting, retaining and developing the best team is critical to achieving Bowthorpe's Vision. We will continue to enhance our employee development programmes, which are benchmarked against those of other world class organisations, to ensure that we enable our people to reach their potential to the benefit of our customers. Key Dates:
- Company founded as Goodlife Electric Supplies.
- Name changed to Bowthorpe plc.
- Death of founder Jack Bowthorpe.
- Bowthorpe International is formed.
- Company acquire the U.S. firm Optim Electronics.
- Bowthorpe divests defense manufacturers Hellerman Deutsch and McGeoch.
- Acquisitions of Avionics, B & D Electronics, Penny & Giles, and Odessa Engineering.
- Start of company-wide reorganization.
- Sell off of automotive industry operations, and thermal management systems division.
Bowthorpe plc is one of the United Kingdom's leading suppliers of diversified electronics products, with an increasing emphasis on high-technology products for the telecommunications and other industries. Bowthorpe operates through a network of approximately 50 subsidiary companies with operations in more than 30 countries. Since its purchase of Netcom Systems in 1999, Bowthorpe's largest single market has been the United States, which accounted for more than 41 percent of sales. Europe, including the United Kingdom, continues to account for about half of the company's total sales. After a restructuring of its business focus in the late 1990s, Bowthorpe has reorganized its subsidiary companies into five core operating divisions. For the telecommunications industry, Bowthorpe provides testing instruments and systems, including ATM test systems, channel emulators, noise and interference emulators, and testing equipment and products for such satellite navigation systems as the Global Positioning System (GPS). In January 2000, Bowthorpe reorganized this division under the name SPIRENT Communications. In the Power Management field, the company offers products in three key areas, those of power control, power conversion, and power quality. This division's products include such wide-ranging applications as power control devices for wheelchairs and power supplies to the telecommunications, networking, medical, computer, and other industries, as well as power conversion systems, and surge and lightning arrest systems and products. The company also produces the so-called "black boxes" for the avionics industry. Led by its WAGO spring clamp system, the company's Interconnection division produces approximately 12,000 cabling, wiring, and related products. Network management has taken on a larger role for the company, particularly since its $400 million purchase of Netcom Systems; this division also produces a range of customized mice, trackballs, and keyboards. The last of the Bowthorpe divisions is involved in sensing equipment, including thermal sensing, and management systems, a segment the company expected to exit by early 2000. Led by chief executive Nicholas Brookes, Bowthorpe posted sales in excess of £608 million in 1998.
Founding an Electronics Conglomerate in the 1930s
Bowthorpe was founded as Goodlife Electric Supplies by Jack Bowthorpe in the mid-1930s, a period that saw England rapidly becoming dependent on electric power. Bowthorpe's father had worked for General Electric; Jack Bowthorpe stuck close to his father's line, launching his own company in 1936. Bowthorpe's first employee was Ray Parsons, then only 15 years old. Apart from becoming Bowthorpe's brother-in-law, Parsons was to play a key role in the company's later growth, especially after Bowthorpe's death in the late 1970s, when Parsons was named chairman.
Goodlife first produced connectors and other fittings for the country's electric lines, prompting the company to adopt as its first slogan: "Up the Pole." Over the next decades the company--which changed its name to Bowthorpe in 1949--developed a wider focus, providing products for the electrical and other industries.
After assuming leadership of the company in 1978, Parsons began transforming Bowthorpe into a diversified conglomerate with a focus on niche electrical products. In 1979 Parsons was joined by chief executive Dr. John Westhead, who had been working for General Electric. Westhead took over as non-executive chairman in 1992, when Parsons retired after 55 years with the company.
In the meantime, the pair transformed Bowthorpe into a diversified, international operation. The company's overseas arm, Bowthorpe International, was created in 1982 and took charge of the company's expansion, especially into the U.S. market, as well as across Europe. By the late 1980s, Bowthorpe's focus began to shift again, now looking toward the booming electronics industry for its future growth. During the remaining years of the decade, the company made more than 20 acquisitions, including Optim Electronics of the United States in 1987. The company quickly added expertise in thermal management through the acquisition of Thermalloy and its heat sink products in 1988; a year earlier the company had acquired a line of surge suppression devices through the purchase of Atlantic Scientific. In the process, the company built up a strong position as a military defense contractor. About 30 percent of the company's sales came from the defense sector.
Bowthorpe's acquisition drive continued into the 1990s, creating an international conglomerate of more than 50 fairly autonomous companies. While operations had extended to 20 countries, the company's largest single market was now the United States. The end of the Cold War, coupled with an extended recession, brought the company into difficulties. In order to boost slowing sales and sinking profits, Bowthorpe moved to decrease its reliance on defense sector contracts.
Reorganizing in the 1990s
After selling off its Hellerman Deutsch and McGeoch defense manufacturing wing in 1990, Bowthorpe began strengthening its electronics base. In 1992, the company acquired Avionics, a leading flight recorder ("black box") manufacturer. The company also acquired B & D Electronics, Penny & Giles, and Odessa Engineering then moved into environmental testing with the purchase of the emissions monitoring business of Lear Siegler, in 1993. Bowthorpe had successfully reduced its exposure to the shrinking defense industry, which accounted for just over six percent of the company's total sales of £334 million in 1994. As the company's European and U.S. operations were recovering from the extended economic difficulties of the early 1990s, the company continued its growth-through-acquisition drive, reportedly looking at some 300 acquisition candidates per year. While adding to its U.S. and European base, the company also announced its intention to expand operations into the Asian markets.
The year 1996 marked the beginning of a new era. After Westhead retired to the position of non-executive chairman, Bowthorpe hired Nicholas Brookes as its new chief executive. Brookes intended to lead Bowthorpe into a reorganization of its operations to concentrate its activities on high-growth, high-technology products. Brookes also moved to streamline the company's structure: by then, Bowthorpe had grown to more than 100 subsidiary companies, organized into 12 primary divisions. Brookes cut back on the number of its divisions, setting up just five core business areas, including the booming telecommunications market, as well as power supply and systems testing markets. The company began selling off its newly non-core operations while continuing to make strategic acquisitions to round out its new divisions.
By the late 1990s, Bowthorpe had reduced its number of subsidiary companies to just 50. Telecommunications, and especially advanced testing equipment for ATM (asynchronous transfer mode) switching equipment, modems, cellular, and other voice and data transmission systems became a top priority for the company. With network and communications systems seen as one of the major growth areas for the coming decades, and with the world coming more and more to rely on satellite, cellular, telephone, Internet, and network technologies, Bowthorpe had recognized the need for increasingly sophisticated testing and analysis products, systems, and procedures to ensure smooth communication systems operations. In the late 1990s, the company boosted this division to its single largest, adding Wireless Telecom Group and Consultronics in 1999. In that year, also, Bowthorpe made its largest acquisition to date, paying $463 million to buy Netcom Systems, Inc., of California. The Netcom Systems acquisition helped secure Bowthorpe's position as one of the world's leading manufacturers of telecommunications testing equipment.
In the late 1990s, Bowthorpe expanded its power supply and power conversion division, with the acquisition in 1998 of Conversion Equipment, a manufacturer of power supplies for telecommunications and computer systems based in the United States. Meanwhile, Bowthorpe continued to shed operations no longer central to its future strategy. In 1997, for example, the company sold off its Starpoint subsidiary, a maker of parts for amusement machines. In late 1999, Bowthorpe also announced its intention to exit one of its five core areas, that of thermal management products, a move expected to take place early in 2000. The sale of its Optim subsidiary in December 1999 was part of Bowthorpe's disposal of its automotive industry operations.
By the beginning of the year 2000, Bowthorpe had completed roughly half of its reorganization program. The company took a new step toward its final form at the end of January of that year, when it announced its intention to merge several of its telecommunications testing companies, including Netcom Systems, Adtech, Telecom Analysis Systems, Global Simulation Systems, and DLS TestWorks into a single testing and measurement subsidiary, dubbed SPIRENT Communications. While the full benefits of its reorganization were not expected to be seen for another two years or more, Bowthorpe was already beginning to reap the rewards of becoming one of the world's leaders in its core sectors, with profit forecasts for the 1999 year expected to top £95 million.
Principal Subsidiaries: Adtech, Inc.; Atlantic Scientific Corporation; Autronics Corporation; Bowthorpe Australia Pty Ltd.; Bowthorpe Components Ltd.; Bowthorpe EMP Ltd.; Bowthorpe Holdings Corporation; Bowthorpe International Inc.; Bowthorpe plc; Bowthorpe-Hellermann (Pty) Ltd. (90%); Curamik Electronics GmbH (65%); Devlin Electronics Ltd.; Edgcumbe Instruments Ltd; El.Bo.Mec. Thermalloy Srl (Italy); The Flight Data Company Ltd.; General Eastern Instruments Inc. (U.S.); Global Simulation Systems Ltd.; Hellermann France SA; Holaday Industries Inc. (U.S.; 95%); Kaye Instruments Inc. (U.S.); Keystone Thermometrics Corporation (U.S.); Monitor Labs, Inc. (U.S.); Monitor Products Company Inc. (U.S.); Paul Hellermann GmbH (Germany); Penny & Giles Aerospace Ltd.; Penny & Giles Controls Ltd.; Penny & Giles Drives Technology Ltd.; Protimeter plc; Redpoint Thermalloy Ltd.; Switching Systems International (U.S.); Telecom Analysis Systems Inc. (U.S.); Thermalloy Inc. (U.S.); Thermometrics Inc. (U.S.); TytonHellermann do Brasil Industria e Commercio Ltda.; WAGO Kontakttechnik GmbH (Germany; 50%); Western Pacific Data Systems Inc. (U.S.).
Principal Operating Units: Communications; Interconnection; Systems; Cable Management; Sensing.
Principal Competitors: Agilent Technologies; Danaher Corp.; Eaton Corp.; Emerson Electric Co.; General Electric Company, plc; Hadco Corp.; Honeywell Inc.; Hubbell Inc.; IMI plc; MicroTel International Ltd.; Molex Inc.; Pirelli S.p.A.; Teradyne, Inc.; Thomas & Betts Corp.; Union Carbide Corp.; Von Roll; Wavetek Wandel & Goltermann.
- "Bowthorpe Buys Netcom Systems," Reuters Business Report, June 15, 1999.
- "Bowthorpe Set to Expand," Independent, March 28, 1996, p. 22.
- Cole, Robert, "Bowthorpe Surges through U.S. Deals," Independent, September 22, 1994, p. 22.
- Farrand, Tim, "Bowthorpe's U.S. Buy Boosts Shares," Reuters, June 15, 1999.
- "Gold Offers Riches for Bowthorpe," Daily Telegraph, February 11, 2000, p. 37.
- "Reliable Bowthorpe," Independent, March 24, 1994, p. 38.
Source: International Directory of Company Histories, Vol. 33. St. James Press, 2000.