Huhtamaki will set up new manufacturing facilities in Egypt and India to boost growth in its flexible packaging business.
The largest of the new units will be located in Cairo, while the other two are located in northeast India. In addition, one label manufacturing unit in Mumbai will be relocated and modernised, completing a round of investment worth approximately €32 million across the two countries. The majority of the changes are expected to take place before the end of 2017.
“The investment in Egypt marks our entry into manufacturing flexible packaging in Africa,” explained Huhtamaki CEO Jukka Moisio. “With its rapid population growth Africa is expected to offer sizable future growth opportunities to us and our customers.
“With the investments in India we will further improve our geographic coverage of the country and our ability to service customers in food and pharma 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 owns 75%. The remaining 25% is owned by Huhtamaki’s Egyptian joint venture partner in the moulded fibre business, Ayman Korra. The total investment – including land acquisition, the first phase of the facility construction, machinery and utilities is expected to be around €23 million, with the Finnish packaging company providing €17 million of this.
Manufacturing at the facility is scheduled to begin during 2018 and the unit is expected to employ about 300 employees when fully operational. The unit will serve both global and local flexible packaging customers as well as providing an opportunity for Huhtamaki to export its products to other countries.
Huhtamaki currently serves flexible packaging customers in Egypt from its operations in UAE and India.
“We’re excited to expand our manufacturing network into Africa,” said Olli Koponen, executive vice president of Huhtamaki’s flexible packaging business segment. “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, a new flexible packaging manufacturing unit will be set up 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 secure room for growth.
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