Huhtamaki on an expansion drive: buys Czech company; expands in UK

Finland-headquartered Huhtamäki Oyj's subsidiary has entered into an agreement to acquire Fiomo, a privately owned manufacturer of flexible packaging foils and labels in the Czech Republic. With the acquisition Huhtamaki expands its flexible packaging manufacturing footprint to Eastern Europe and is able to offer agile high quality off-set printing capabilities for smaller production runs for its customers in Europe, it says.

The annual net sales of the acquired business in 2014 were approximately EUR21 million and it employs approximately 120 people in its manufacturing unit in the Prague area. The debt-free purchase price is approximately EUR28 million. The unit will become part of Huhtamaki's Flexible Packaging business segment.

The transaction is expected to be finalised in early 2016.

Meanwhile, in the UK, Huhtamaki is investing in new capacity at its moulded fibre packaging manufacturing unit in Lurgan, Northern Ireland. The total investment is approximately GBP5 million. Machinery installation is expected to be completed in early 2016.

The Lurgan unit, which has been manufacturing moulded fibre packaging such as egg cartons, egg trays and cup carriers for 80 years, is expanding its manufacturing capacity to meet the needs of the growing egg market in the UK and Ireland.

In November last year, Huhtamaki also said it will make a sizable investment to develop and expand its foodservice packaging manufacturing unit in Gosport, UK. The total investment for extending both manufacturing and warehouse areas is approximately GBP7 million. The expansion next to existing facilities is expected to be completed by March 2017.

The Finnish company says that insulated paper cup forming machines and a major new PET tumbler manufacturing line with capabilities to process both regular and recycled PET have been installed into the Gosport unit last year. The new manufacturing and warehouse area expansion will allow optimisation of production layout as well as room for further growth. Combined with the earlier machinery investments it will serve foodservice customers in the UK and Western Europe.

Huhtamaki has 16,700 employees across 69 manufacturing units and 23 sales offices worldwide, and with 3 business areas - foodservice packaging, flexible packaging and moulded fibre packaging. In the UK, Huhtamaki has 3 manufacturing units: a moulded fibre packaging site in Lurgan and two foodservice packaging sites situated in Gosport and Blackburn.