80% of tech high-flyer sells to Japan

Patrick Teo, CEO of BCS Group. Photo / Glenn Jeffrey

BCS says sale to world heavyweight in materials handling will help expansion, create high-value jobs

One of New Zealand's fastest-growing tech companies, baggage handling and logistics systems firm BCS Group, is selling an 80 per cent stake to Japanese rival Daifuku.

The company will continue to operate as usual with staff and company practices unchanged, but BCS chief executive Patrick Teo said the acquisition would provide much needed scope in the market.

"We see it as mutually beneficial. BCS adds to Daifuku's global presence in baggage handling, and we're big in countries where they are not."

Teo said company growth had been restricted by slower traction in the market, not a lack of funds, and the partnership with Daifuku would allow expansion.

BCS Group was number two on the Technology Investment Network TIN100 list of the top ten highest growth companies for the year and number 11 overall by revenue.

Company revenue for the year grew by 67.7 per cent to $140 million, boosted through several major deals with airports globally. This included a $55 million deal building baggage systems for Kuala Lumpur's international airport, and collaborative work with Daifuku.

According to Teo, the acquisition will create more jobs in the company and increase the R&D spend.

"The reality is we'll increase our portfolio of innovative solutions and products that will benefit not only our customers in the airport sector but also in the high-growth courier sortation market."

"We'll also be investing more heavily into R&D and that has got to be good both from an employment perspective and our ongoing need for more staff, as well as creating more high-value jobs."

Daifuku, based in Osaka and listed on the Tokyo stock exchange, is one of the world's largest materials handling companies with annual turnover of more than US$2.3 billion ($2.93 billion). Chief executive Masaki Hojo said he was excited about the acquisition, noting that New Zealand had a strong reputation for innovation.

"We see significant potential in BCS and its flagship products and solutions, and we're very excited about investing in more R&D from New Zealand," Hojo said.

"New Zealand has a reputation for very good, smart and robust innovation and we regard this as an area we want to invest in and grow."

Daifuku had invested in New Zealand through Auckland Uni Services in the early 1990s, helping the university develop the world's first fully controllable inductive power system.

The acquisition will be completed next month, with the current management and structure remaining unchanged, and two Daifuku staff joining BCS Group's board.

BCS Group
• Company revenue increased by 67.7% to $140 million this year.
• The company is the 11th largest tech company by revenue in NZ (TIN100).
• Automotive and airport systems manufacturer Daifuku has purchased an 80% stake in BCS Group.