Japanese to penetrate US packaging machinery sector
finalising its acquisition of Hoppmann, a move that will expand the
firm's presence within the lucrative US market.
A letter of intent has been signed for Shibuya to acquire 100 per cent of Hoppmann's US shares with the purchase to close this July.
The acquisition comes just as world demand for packaging machinery is projected to rise over 4 per cent a year through 2008 to over $31 billion. Market research firm Freedonia says that improving economic fundamentals - especially income levels - will bolster most packaging machinery consuming sectors.
As a result, manufacturing output is set to increase, creating opportunities for packaging machinery suppliers, according to the report. It is this growth that Shibuya is keen on exploiting.
The publicly-listed company, which recorded sales last year of $500 million, manufactures filling systems, bottle unscramblers, washers, cappers, labellers, casers and packers, conveyors and palletising equipment. Hoppmann on the other hand is a privately held company, which reported sales of $15 million.
The firm specialises in manufacturing assembly systems, labelling machinery, and is the industry leader in high speed, centrifugal feeders/unscramblers.
This acquisition gives Shibuya the opportunity to market their full line of packaging machinery to an existing US customer base, and to greatly enhance existing Hoppmann sales. It is hoped that the Hoppmann - Shibuya combination will result in a new US packaging machinery leader.
According to Freedonia, labelling and coding machinery will remain the fastest growing product. Advances will result from the increasing number of labelling regulations in many parts of the world, as well as from shippers' need to track product.
Filling and form/fill/seal equipment will remain the largest product group, due to their widespread use across a range of industries. And new product development activity will continue in all product categories, with packaging machinery manufacturers continuing to introduce smarter, faster and more flexible units.
In 2003, the world packaging machinery market was valued at $24.7 billion, with 38 per cent of the total accounted for by Asia/Pacific countries, followed by North America with 26 per cent and Western Europe with 24 per cent.
