Fall 2008: orders dropped precipitously, and companies throughout the plastics industry began taking steps to batten their hatches for the economic crisis. Employees were told to work fewer hours, or were laid off; travel costs were trimmed; investments were delayed: these and other cash management measures were implemented at many processors, and at their suppliers as well. Extruder manufacturer Reifenhäuser (Troisdorf, Germany) also took many of these steps, but in a meeting that autumn, said Ulrich Reifenhäuser, he and his two brothers decided more needed to be done. “We had a serious talk and decided we needed to take a big leap, not just take small steps to get through this crisis,” he said.
Ulrich (left) and Klaus Reifenhäuser with Edgar Gandelheidt (center), managing director of the newly formed Reifenhäuser Kiefel Extrusion GmbH.
Although ownership of two leading blown-film extruder manufacturers (Gloucester and Kiefel) has changed in the past years, this corner of the plastics processing machinery market has seen little in the way of mergers and acquisitions for many years. The company Reifenhäuser changed that early this week when it announced its acquisition of the blown-film extrusion line business of Kiefel, combining this with its own blown-film extruder business to create Reifenhäuser Kiefel Extrusion GmbH (initial report here). Kiefel’s former owner, film tenter equipment manufacturer Brückner, kept the thermoforming and welding machinery businesses which also bear the Kiefel name.
Ulrich Reifenhäuser, managing director of the family’s group of companies, said he and his brothers, Bernd and Klaus, had settled on Kiefel as their first choice, and were pleasantly surprised that their inquiry found a willing listener at Bruckner. According to Edgar Gandelheidt, managing director of the new firm and past MD of Kiefel Extrusion, the combined firms can claim a 25-30% market share of the blown film extrusion equipment industry. Perhaps more importantly, noted Ulrich Reifenhäuser, is that the overlap of the two firms’ customer base was only about 10-15%, and he said responses to news of the merger from key customers this week were all positive. The two firms competed directly for some blown film line orders, but “on our lost order reports we rarely saw each other’s names,” said Gandelheidt.
The two firms also match well geographically, said Gandelheidt, with Kiefel having had a stronger presence in, for instance, Latin America, whereas Reifenhäuser has been stronger in the Middle East. Reifenhäuser has a manufacturing facility in China, which is included in the merger, as is some manufacturing, and engineering capacity in Troisdorf. Headquarters for the new firm will be Worms, Germany, Kiefel Extrusion’s longtime HQ.
The newly formed Reifenhäuser Kiefel Extrusion will employ about 300. Asked whether the merger will lead to employee terminations, Ulrich Reifenhäuser said the intent was to keep all current employees. The engineering teams of both will be combined and co-led by the former leaders at both firms: Jens Spigots from Reifenhäuser, and Jochen Hennes from Kiefel. A similar arrangement will handle sales and marketing, with Kiefel’s Kurt Freye and Reifenhäuser’s Bernd Schroater teaming for Reifenhäuser Kiefel Extrusion. By the K Show in Düsseldorf, Germany in October 2010, the newly formed company intends to have a new machine to display that executives there say will combine the best of both brands. —Matt Defosse
Further updated on August 28, 2009: Neither Reifenhäuser nor Brückner officials would reveal the price of the acquisition. Peter Wellenhofer, chairman of the board for Brückner Technology Holding GmbH, in reply to a question from MPW asking if his company had concrete plans for the revenue from its sale of Kiefel Extrusion, said Brückner Technology Holding plans to continue strategic moves to add to its portfolio, to include of companies from other branches, to help it weather the very volatile nature of the market for film orientation equipment, such as that made and sold by its flagship company.