BCD Holdings chairman John Fentener van Vlissingen last month spoke to Business Travel News editors David Meyer and Jennifer Merritt about the breadth of his family business, the realignment of its global travel management company, recent and future acquisitions and the possibility of entering new lines of travel business. BCD Holdings includes BCD Travel, Park 'N Fly and Air Trade, a Dutch online leisure travel agency soon to launch in the United States, as well as a Caribbean bank and a mortgage brokerage, a real estate development and management firm, and an interest in a small community bank, all in Atlanta.Business Travel News: As a long-term player in the industry, is it your vision to be the largest?
John Fentener Van Vlissingen: It sounds very strange to say it, but I would hate to be the largest. I feel very comfortable being number two, three or even four in the industry. I still think we will grow quite considerably, because the tendency we started with right from the beginning is consolidation. We will become more global. If you look at our balance, it's about 55 percent America, 45 percent out of the United States. My guess is it will become 40 percent United States, 60 percent outside, because we'll grow in the Far East, Australia and South America. America will keep growing, but the other part will grow faster.
BTN: One of the things that makes American Express such a big player is its card business. Because you have so much financial holdings and background, including a banking venture in Atlanta, is that something you're tempted to consider?
Van Vlissingen: I'm not avoiding the question totally, but that's something BCD Travel CEO Mike Buckman should speak to. That's certainly an area we're looking into.
BTN: How would you define your role within BCD Travel?
Van Vlissingen: I give direction. It's a typical role within a family company—it's your own money, you want to know where it goes. I have full confidence that we have an excellent team who will do their best. It's always better if you've been involved from the beginning, and you still stand behind it and understand what your team is doing. I don't interfere with that. I do not believe in two captains on a ship. The captain in BCD Travel is Mike Buckman and the captain in BCD Holdings is Joop Drechsel, and they both understand the typical role in a family company that the investor takes the lead in where the ship goes, but leaves the sailing to other people.
BTN: Are you in ownership positions in all BCD Travel's business?
Van Vlissingen: We realized we had to acquire in order to become simply a company where you would have your own organization. As of today, about 75 percent to 80 percent of sales come from our own organization. We're not yet there, but we're getting very close, after the acquisition of the English company, The Travel Company, and TQ3 Travel Solutions Management Holdings from TUI in Germany. Now, with total owned sales of $9 billion, we're getting pretty close, but there are some areas where we are in negotiations at the moment. In the coming 12 months, we'll add another three to five countries to make the total complete. I hope it's in six months, but if it doesn't happen by then, it's because of legal reasons. Sometimes, like with TQ3, there are legal reasons why they slow down, but my guess is within six months we'll sign several. In the end, the goal is to be in 90 percent of all the important major economic centers in the world.
BTN: Do you currently have an interest in those three to five companies?
Van Vlissingen: No. They are generally where we think we need to be. It doesn't fit in every company, but in most countries we will take the majority or 100 percent.
BTN: Are you looking to buy in Asia, Latin America and Europe?
Van Vlissingen: Yes, but I don't want to go any further—that could hurt our negotiations. We want to strengthen in the Far East. We've always played a good role in South America, we want to strengthen there too, and there are some countries in Europe where we should be as well.
BTN: The acquisition of The Travel Company and its affiliate organization, Synergi, gave BCD a strong presence in the U.K. and a strong affiliate network—
Van Vlissingen: That was one of our problems—but it's a healthy problem. We had three possibilities: Synergi, TQ3 and BTI. So we had to make choices. Joop Drechsel traveled around with Mike Buckman to Singapore, to Dubai, to all kinds of areas, and we will make a further announcement within a few weeks about the total affiliation group. It's a pretty impressive group. In the countries where we own, we will only further acquire; we will not affiliate. But in countries we're not in, it's a way to expand our reach.
BTN: TUI has a big presence in Germany. Is there opportunity there for further growth?
Van Vlissingen: It has lot of potential, a very good client list and in the management structure, which I'm very excited about, we are very international. I think it's very good that we have an international executive board. We formed a non-executive board, and on purpose, we've done that very international. My son Robert is on the board. He's also chairman of the board of Park 'N Fly. He's slowly coming on board in different responsibilities. He's 37, learning the business and he certainly has his own opinions, which is good.
BTN: You own 13 Park 'N Fly airport parking locations, with 50 total U.S. locations. Is that an expanding business?
Van Vlissingen: About a year ago, we acquired Park One in Los Angeles, which is such a well-known name that we still call it Park One and under it is Park 'N Fly, but slowly that will change. We have started a new location in Fort Lauderdale and at the request of clients we are going to make every location have the option of covered parking. We have looked into Europe and it is far more complicated, because of the different countries and because the airports, very often, control themselves. I would love to go to Europe, if I could find an area where that is possible.
BTN: We recently spoke with Mike Buckman
(BTN, March 20) and he said it would be a small staff at BCD's new Amsterdam headquarters.
Van Vlissingen: I hate head offices. Where do you need to be to be in a service industry? You need to be close to your client. I hate all those people in a head office who always think they know better what should happen in Argentina, or Chile or China. You need to have quality locally, so the head office should be very small. We've always been strict in financial controls, so the head office should have the cash management and contact with the banks—it's a different kind of contact.
BTN: Why did you choose Amsterdam?
Van Vlissingen: We need to be at a major airport. It needs to be a country that, in general, speaks English and understands English, so it boiled down pretty quick. We didn't want to be in Germany because of the major takeover there and that would give the wrong signal, so we ended up with Amsterdam purely on price. It could have been London, but London is so outrageously expensive, it would have added millions of cost, and I've just explained how important I find the head office. It's not because the shareholder is sitting there. It might be a slight advantage, but that was not the main reason.
BTN: What will happen to the Atlanta office?
Van Vlissingen: Not much. Their role has increased because they now have the responsibility of Canada and South America. As you know, the majority of the global accounts get driven from America, not Amsterdam. For the years to come, I think most of the accounts will get driven from America, because that's where most of the Fortune 500 operations are. If the price is right, we will make acquisitions in America, too. It's not a priority—our priority is to fill the few gaps we still have, but if an opportunity comes along, we're OK investing in America.
BTN: BCD's sister company, Boron Securities, holds slightly more than 11 percent of the shares of Navigant. If rumors of Carlson buying Accor's stake in Carlson Wagonlit Travel are true
(see story), and they then buy Navigant, will you remain an investor?
Van Vlissingen: After Sept. 11, Navigant's price really dove to $5 or $6 a share and that's about the time I acquired an interest, mainly because you could see after that the industry would change—you didn't know what direction, but you knew it would change—and it will be good to have an interest in Navigant as a long-term player. I have that interest now at a good cost price and we will see what the future will bring. I'm not in the management, I'm not on the board and I don't want to be. I have no intention to sell one share, even if the price goes down. I am a buyer, which I've shown before. It dropped back two months ago, close to $10, and I picked up another 100,000 shares.
BTN: Do you have an interest in acquiring Accor's shares?
Van Vlissingen: I read that Accor is going to change its position. They are clearly in discussion to get out—that's not really so new, they've said that before. They've made that announcement and we'll see what happens. If I would be interested, I should make no comment, if I wouldn't be, I should make no comment.
BTN: Why did Hogg and BCD finally decide to part ways?
Van Vlissingen: It's been a good partnership and we've both gained from it over the years, but about three to four years ago, several of our clients—and also my own staff—were saying more and more that maybe that was something of the past. Clients were saying, "You're a good company with good technology, you can serve us globally, but you don't talk with one voice. As far as technology, you're too much diversified." With all this demand for one company, one management approach, we had to think it over. When we first decided to integrate BTI, we called the project, "Listen, Listen, Act," because that explains what it takes for such an effort to be successful: a long time listening. I talked with my partner, as everybody knows, for many years and listened to them, their ideas, our ideas and in the end, we said let's act. We tried to come to a conclusion with our partner, and obviously there are reasons it finally did not succeed on both sides.
BTN: Did both you and David Radcliffe each see full ownership as a goal?
Van Vlissingen: I'm very careful to comment on anything David is thinking or to compare what I am thinking to what David is thinking. He is owned by a venture capitalist. I'm a very long-term player. I want to bring it to the next generation. I want to stay in the industry. As you can imagine, I could have sold many times, but I don't find that fun. I find it fun building a company, building it further and trying to be ahead of the game.