LA Seda supports its strategic growth

LA Seda supports its strategic…
In 2011 La Seda de Barcelona (LSB) completed its financial and operational restructuring process successfully. After refinancing its debt with the banks and redefining its core business by focusing on the Plastic Packaging sector, LSB is now facing a growth strategy for 2012 to allow its consolidation as one of the European leaders in this field.

The Board of Directors of LSB has designed a strategic plan aimed at boosting the Plastic Packaging Division (APPE) that includes the expansion into new markets and the focus on new materials and products. The creation of a new company that integrates all the chemical businesses of the Group (PTA, Glycol, PET, chemical PET Recycling and Technology) and that allows the admittance of an industrial partner supporting and complementing the growth and investment strategy is also considered to be essential.

Notwithstanding this, the credit shortage in the financial markets poses difficulties to carrying out the necessary investments to face the foreseen growth, the presence in new markets and the launch of new products, this is why the Board of Directors of La Seda de Barcelona has agreed to propose to the shareholders of the Company a capital increase of 40 million Euros.

The capital increase will be carried out with a preemptive right for all current shareholders. With this capital injection and the new growth strategy, LSB sets out to improve its competitive position, by offering better products and services to its customers, while creating a higher value for the company’s shareholders. LSB’s Plastic Packaging Division APPE is market leader in the design and manufacturing of PET preforms and containers for a broad variety of end-user markets, as for example food, personal and home care.

With production plants in the United Kingdom, Germany, France, Spain, Belgium, Morocco, Turkey and Greece, the Packaging Division is able to provide its customers with a Pan-European service, while also meeting local needs. APPE is also European leader in the recycling of PET containers and major producer of high quality rPET that is fit for food consumption.

To consolidate its leadership in Europe, LSB will promote and enhance APPE’s presence in Northern and Eastern European markets (including Russia and Ukraine), the fastest growing nowadays, by building a new production facility in Poland. The new growth strategy does also include the building of a new production facility in Italy one of the biggest European markets in Plastic Packaging.

APPE’s future is also linked to incorporating new materials and products such as HDPE, giving access to new market segments such as dairy products.

Additionally to the use of new plastic materials, APPE will launch a series of innovative technological developments - Activeseal, Hotfill Double Blow, Deep Grip, Heat Set - which improve the final product properties and reduce the environmental impact.

Besides, APPE is foreseeing to increase the number of TTW (Through the Wall) service locations, as current supplier of the integrated service that provides preform + blowing integrated in the customers’ production line, thus accompanying them in the development of new markets.

The Board of Directors of LSB considers that integrating all chemical businesses from raw materials to PET production will improve its capacity to compete in the markets by reducing production and logistics costs. This is why it has decided to create a new Division that comprises all PTA, Glycol, PET, rPET and Technology businesses.

The new Division will have PET production plants in Spain, Italy, Turkey and Greece; raw materials (Glycol) in Spain and in Portugal (PTA), as well as recycling plants in Spain and Italy. Among future projects, the investment for a 400.000 Tn PET production plant in Sines (Portugal) is being analysed.

The recycled PET production (chemical MELT process) will also be promoted in Italy (San Giorgio) and in Spain (El Prat), by means of launching a new product, Elite, which offers an equivalent quality to the 100% virgin PET though with varying percentages of rPET. By means of creating this new Division, the Board of Directors considers essential to incorporate an industrial partner to complement the growth and investment strategy and share the vision of being a European leader in integrated PET.