De La Rue has struck a joint venture with a Canadian partner as it attempts to win back the British passports contract it lost eight years ago to a European rival.
The security printing specialist, which supplies the Bank of England banknotes, has agreed a strategic partnership with Canadian Bank Note Company (CBN) and is preparing to tender for the new £360 million government passport contract.
De La Rue missed out on the new blue passports contract to Gemalto, a French-Dutch rival, in 2018 which hit the company’s financial position and led to the closure of its Gateshead site and job losses.
The government’s decision to hand the contract to a foreign rival at a time when Britain was leaving the European Union angered some politicians, including Sir Keir Starmer, the shadow Brexit secretary at the time, who called for the decision to be reversed.
De La Rue, which is based in Basingstoke and traces its roots to 1813, delisted from the London Stock Exchange last year after being acquired by Atlas Holdings, a US private equity firm, for £263 million, bringing to an end a tumultuous period for the company.
It sold its authentication business for £300 million to Crane NXT, a US competitor, in a separate deal earlier last year and divested its passports business to Sweden’s HID Global for £42 million in 2019.
De La Rue said the 50-50 joint venture would combine its UK manufacturing capabilities and security document heritage with CBN, which is the largest supplier of passports to the Commonwealth, including to Canada and New Zealand.
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They are evaluating manufacturing the British passport at one of De La Rue’s three existing sites, in Westhoughton in Greater Manchester, Debden in Essex, and Basingstoke, or at a new greenfield site, should they win the contract.
British passports are currently manufactured in Tczew, Poland, by Thales, the French multinational which acquired Gemalto. The tender to manufacture the next series of British passports for 12 years from 2027 is due be issued later this year.
De La Rue and CBN, which has its headquarters in Ottawa, are vowing to “ensure full sovereignty over the critical supply chain and bolster border security”.
Clive Vacher, chief executive of De La Rue, said the British passport “is more than a travel document, it is a symbol of our national identity”, and said the joint venture would “bring passport manufacturing back to Britain, where it belongs”.
The Home Office, through a preliminary market engagement notice, has been engaging with prospective suppliers. The contract covers the design artwork, manufacturing and personalisation of passports, under a contract starting in 2027, to replace the current deal which expires in 2029.