Salzgitter to buy SIG Beverages unit

Last year Salzgitter bought Kloeckner-Werke, owner of the filling and packaging business KHS, as part of its strategy to enter into new industrial sectors. That deal saw it build a presence in the engineering and machine building area of beverage filling and packaging technologies. The acquisition of SIG Beverages, announced this week, is an 'initial, and highly relevant step' in further developing Kloeckner-Werke, said the steel company in a statement. The deal will allow KHS to operate as "a single source provider, offering complete facilities and systems to the dynamic plastic bottle technology growth market"​, according to Salzgitter. Over the five years to 2006, the global PET packaging market has grown at a compound annual growth rate of 9 per cent to be worth €17 billion, according to a report from IntertechPira. Use of PET bottles continues to replace other forms of beverage packaging such as metal or glass, offering advantages in weight in particular. They are also shatterproof and transparent. PET bottling is seeing strong increase in demand in emerging markets like China. SIG-Beverages, which has 480 employees, mostly in Germany, last year generated sales of about €150 million from its PET bottling sales. It includes the Corpoplast division that focuses on PET bottle design and stretch blow moulding as well as Plasmax, which deals with barrier technology and the aseptic filling business, Asbofill. No financial details about the deal were disclosed and no-one at SIG was available to discuss the reasons for the sale. SIG's beverage business was significantly smaller than its carton packaging. The group was bought by privately owned New Zealand firm Rank last year and is said to be focusing more on paper as it aims to increase its share in the market dominated by Sweden's Tetra Pak. It is the world's second-biggest maker of drink cartons after Tetra, with an estimated 15 per cent share last year. Klöckner-Werke employs more than 4,000 people worldwide and generates annual sales of about €830 million. Its subsidiaries also include injection moulding machinery manufacturing, shoe machinery and process machinery for the confectionery industry. Salzgitter is one of Europe's leading steel and technology corporations with a workforce of 24,000 employees. It is now one of the leading providers of filling and packaging technology.