CSA Group is selling its testing, inspection and certification unit to the Netherlands-based Kiwa Group for $2.1-billion in cash.
Proceeds from the transaction will be placed in a newly formed, dedicated legal entity that will be wholly owned by, but governed separately from, the Canadian Standards Association, CSA Group said. The new entity will help fund the standalone not-for-profit association.
CSA Group has developed and maintained more than 3,000 codes and standards for dozens of industries since it was established as the Canadian Engineering Standards Association in 1919. Sectors ranging from electronics to construction materials, nuclear-power facilities and children’s toys have adopted CSA Group standards.
The product-testing business started as a small, adjacent operation to the CSA in the 1950s. Over the decades, it established a global presence with its labs now serving more than 140 markets around the world. Its certification mark is widely considered a validation of a product’s quality.
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Selling the testing, inspection and certification business “gives the Canadian Standards Association a financial foundation that is not exposed to the pressures of a large commercial business,” CSA Group spokesperson Mike Hamilton said via e-mail in response to questions on why the sale process was originally launched.
The deal gives the CSA “a stronger, more secure financial foundation so it can pursue its mission of making communities safer, healthier and more sustainable in Canada and around the world,” Mr. Hamilton said.
CSA Group is governed by a volunteer board of directors, most of whom are elected by the organization’s 11,000 members.
As part of the deal, David Weinstein, CSA Group’s current chief executive officer, will remain with the testing business when the deal closes, which is expected to happen before the end of 2026. Mary Cianchetti, currently the group’s president of standards, will then succeed him as CEO.
Kiwa Group is a global testing and certification giant with more than 12,000 employees based across 40 countries. In 2021, Kiwa was acquired by SHV, which is the Fentener van Vlissingen family’s private holding company.
The family is one of the Netherlands’ richest dynasties. Their roots trace to the early 17th century, though much of the family’s wealth was established by investments in the coal industry in the late 1800s.
The transaction requires approval from at least two thirds of the votes cast at a special meeting of CSA’s membership, which is expected to be held in early October.