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A friend of mine who recently started the hobby with Dark Vengeance (We split it, I took the Chaos Marines and he the Dark Angles). I helped him replace the shoulder pads for blank ones and shave off the Dark Angels iconography everywhere else (well, most of it) so he could have his own chapter.

So, what I'm asking is what would be a good way to expand from it for Codex: Space Marines (He does not like Dark Angels at all). He wants it to be somewhat competitive, but there are a few units he likes for modeling. I've suggested he get another Tactical Squad because they are flexible, but he loves Centurions.

Anyone on here who is knowledgeable on Space Marines know anything better?

I'd suggest he grab another tatical squad, and get a unit of centurions.

this'll give him a good basis for a CAD and he could then buy a third unit of tatical marines later and try deploying the demi-company formation

What chapter? And almost as important, what kind of army does he like? There are a lot of ways to build a decent marine list. Even if you want to be somewhat competitive.

Drop pods are good, and he’ll need some transports anyway. Rhinos/razors can also work well, depending on the list.

Another tac squad is a solid choice. As is a Dev squad. The all plasma DV tac squad is not the best. Most marine lists are going to need a number of PA bodies.

Sternguard are a solid choice. Getting more veterans would open up the 1st company formation. It also contains a wealth of bits to liven up your army.