GEA Group has sold its food packaging materials division CFS Kempten to fellow German firm Conflex Packaging.
GEA acquired the division when it completed the purchase (first announced last December) of Convenience Food Systems (CFS) Group earlier this year, but said that CFS Kempten would have better prospects under new owners.
CFS Kempten produces food packaging foils, and GEA ceo Juerg Oleas said these complemented one of GEA’s core business areas: food packaging machines.
“But we felt that we can still offer those materials as an ancillary product to our machine customers without having to own and run its production ourselves,” he added.
And a GEA spokesman told FoodProductionDaily.com that the firm would have had to have grown significantly to satisfy GEA’s desire that its divisions hold market-leading positions.
CFS Kempten employs 190 staff and had a turnover of €45m in 2010/11.
Better investment prospects
Given these 2 factors, the spokesman said that a divestment had always been planned since the CFS Group takeover.
He said: “We’re an engineering company. Since the takeover of CFS in March/April, we’ve been sorting through our portfolio, looking at the market to see if we could find a better owner at a good price for us.”
“We could have kept it [CFS Kempten], but it’s not a core business for us.”
The spokesman also confirmed that GEA believed Conflex was more likely to invest in CFS Kempten.
Oleas said: “Under a new ownership focus, they [CFS Kempten] will benefit from more favorable prospects for continued capital investments.”
“For our customers the transaction will make no difference. As to the employees of CFS Kempten, I wish to thank them for their dedicated work."
Completion of the transaction remains subject to German anti-trust approval, which the spokesman said GEA expected to be granted by November.
GEA Group is a major world supplier of process technology and components for the food and energy industries, with a €4.4bn turnover in 2010 and 23,000 staff worldwide.