Huhtamaki to boost flexible packaging growth
Huhtamaki, which produces packaging and labels for products including chocolates and snacks, is to set up three new manufacturing units in Egypt and India to boost growth in its flexible packaging business.
The largest of the new units will be in the greater Cairo area in Egypt and the other two in North East India. In addition, one label manufacturing unit in the Mumbai area will be relocated and modernised.
“The investment in Egypt marks our entry into manufacturing flexible packaging in Africa. With its rapid population growth Africa is expected to offer sizeably future growth opportunities to us and our customers,” says Jukka Moisio, CEO of Huhtamäki Oyj.
“With the investments in India we will further improve our geographic coverage of the country and our ability to service customers in food and pharmaceutical industries. After these additions our total number of manufacturing units in India grows to 17.”
The new manufacturing unit in Egypt will be owned and operated as a joint venture of which Huhtamaki will own 75%. The remaining 25% will be owned by Huhtamaki’s Egyptian joint venture partner in moulded fibre business, Ayman Korra.
The total investment, including the land purchase, the first phase of the facility construction, machinery and utilities is expected to be around €23 million ($25.1m) with Huhtamaki providing around €17m of this.
Manufacturing at the facility is scheduled to start in 2018 and the unit is expected to employ 300 employees when fully operational. The unit will serve both global and local flexible packaging customers as well as export its products into other countries.
Huhtamaki currently serves flexible packaging customers in Egypt from its operations in United Arab Emirates and India. Olli Koponen, executive vice president of Huhtamaki’s flexible packaging business, says, “We will replicate the state of the art solutions from our newest unit in United Arab Emirates and look forward to servicing new and current customers with efficiently produced top quality flexible packaging.”
To better service customers operating in North East India, Huhtamaki will set up a new flexible packaging manufacturing unit in the state of Assam and a label manufacturing unit in the state of Sikkim. Both units are expected to begin operations during the first half of 2017. In addition, a label manufacturing unit operating in the Greater Mumbai Region will be relocated to a new facility in order to gain room for growth. The relocation expected to be completed by the end of 2017. The combined value of these growth investments in India is expected to be around €9m.
