The Peninsular & Oriental Steam Navigation Company (Bovis Division)

79 Pall Mall
London SW1Y 5EJ
England
(01) 930-4343

Incorporated: 1928
Employees: 2,400
Sales: £618 million (US$877 million)

Bovis was a small and relatively unremarkable building enterprise for its first 60 years of operation, but in the years following World War I energetic management and a series of progressive innovations began to expand the firm into a diversified builder. Bovis suffered a financial setback engendered by an aggressive acquisitions spree in the early 1970’s, leading to a takeover by the Peninsular & Oriental Steam Navigation Company in 1974. Carefully controlled growth in the 1980’s has made Bovis Britain’s fourth largest builder.

In 1885 a Mr. Saunders sold the small building business he had founded thirty years before to C.W. Bovis, who changed the enterprise’s name to his own. Bovis spent nearly 25 years nurturing the business before he decided to retire. In 1929 he sold the company to Sidney Glyn and Samuel Joseph. The company continued quietly for another ten years.

V.E. Vincent, Glyn’s younger brother, joined the company at the end of World War I. He redesigned the name-boards displayed on construction sites to attract more attention to the firm and took Bovis into furniture making with the design of a wardrobe for men called the Compactom. A now defunct subsidiary by the same name manufactured and sold the units.

An important innovation in the firm’s construction operations during the 1920’s was the “Bovis System” of negotiating a contract. At the time many builders were struggling with the high and often unpredictable costs of construction, as well as with the intense competition for contracts. While some created precise techniques for estimating the cost of building to a given design, Bovis suggested instead that clients bring in the builder from the beginning. The builder would then base its estimate on the mutually developed design. The plan greatly reduced the likelihood of surprise costs arising after work was underway. It also enabled Bovis to get an early lead on competitors interested in a particular construction job but not prepared to participate in the design phase. In 1927 Marks & Spencer was Bovis’s first customer under the procedure. In later years there would be many more.

Bovis Ltd. went public in 1928 but remained both a parent and an operating company. Glyn, Joseph and Vincent rotated yearly in the executive positions. As the Depression took hold, the company formed a subsidiary called Multiple Properties and hired a property scout to find and purchase suitable sites for Bovis-built shopping centers. Other subsidiaries were created at the same time to take over specialized functions: Nox Ltd. competed for contracts for which the Bovis System was not suitable; and Yeomans & Partners Ltd. handled small jobs. Bovis also established its own school to train builders for the firm.

Like most construction companies, Bovis benefitted from World War II. It won the contract for moving the entire Woolwich Arsenal to Staffordshire in 1940 and later worked with Laing and others on the floating Mulberry Harbours used in the D-Day invasion. Nox build several airfields, and Yeomans & Partners repaired London buildings and works damaged by bombs.

Soon after the war ended, Joseph died (he had been Lord Mayor of London for a time) and Vincent retired. Glyn remained as chairman and named Paul Gilbert managing director. Gilbert immediately formed another subsidiary, Gilbert-Ash Ltd., to specialize in civil engineering and overseas work.

The company expanded rapidly overseas, primarily in Africa, where most British construction companies sought work after the war. At home in England, Gilbert-Ash also took advantage of the prefabricated housing boom. In 1951 the division started erecting schools and other public buildings with a pre-stressed concrete system called Integrid. Another Bovis invention, the plastic window, appeared at this time, but it did not succeed.

By 1959, fifty years after Glyn and his partners had purchased Bovis, they had built it from a small company into an international group of semi-autonomous and often competitive subsidiaries. Glyn retired that year. After the sudden death of Gilbert in 1960, Bovis made administrative changes designed to ensure tighter financial control and accountability and more flexible senior management. The company also bought two housing development companies. The acquisitions boosted the group’s profits from £750,000 in 1967 to £13.5 million in 1972.

Bovis then went on a buying spree, but without changing management practices to accommodate growth. The firm acquired many companies in the U.K., one in Canada, one in Southeast Asia, and property developing sites in Europe. Overextended and somewhat vague about management of the various interests, Bovis began suffering an inward collapse. Profits dropped from the 1972 high to a loss of £12 million in 1973. The company was now an easy target for a takeover; the next year it became a wholly-owned subsidiary of the Peninsular & Oriental Steam Navigation Company (P & O).

After extensive reorganization by P & O, Bovis’s profits crept back up to £7.7 million in 1975. Excess properties were sold, and the construction and civil engineering divisions expanded. Two years later, profits had risen to £8.5 million. However, by 1978 the number of employees had dropped to 2,854 from nearly 10,000 in theearly 1970’s.

In the 1980’s Bovis has maintained steady, controlled growth, eventually becoming Britain’s fourth largest builder. In this decade the firm has received major contracts for the Westminster Conference Centre, a prison in Cambridge, and the rebuilding of the Lloyds headquarters.

Principal Subsidiaries

Gilbert-Ash Ltd.; Audley Properties Ltd.; Bovis Construction Ltd.; Bovis International Inc.; Constructional Units Ltd.; Sepec Securities Ltd.; Wysegroup Ltd.; Yeomans & Partners Ltd.