Alcan selling plastic bottle business

Alcan wants to explore the sale of its food plastic business and of Alcan's plastic bottle business have been put on notice.

Alcan a worldwide packaging leader plans to sell the plastic bottles business as part of an ongoing restructuring of its food packaging operations in order to concentrate its food business on the more profitable flexible packaging market.

Since world demand for converted flexible packaging is forecast to grow by about seven per cent to $53.5bn this year (see PackagingBlog article US flexible packaging demand to decrease) this looks like a logical move for Alcan to make.

Alcan's plastic bottles packaging business has plants in both North America and Europe and in 2004 had sales of $130m. The entire Alcan plastic bottles packaging business employs a total of 495 people. The Alcan plastic bottles packaging unit provides a range plastic bottles for products such as juice, energy drinks, coffee beverages, teas foodservice, and infant formula. They also manufacture both hot and cold fill containers that are used for condiments such as ketchup, salsa, pasta sauces, cheese sauces, syrups, relish, fruit, jams and jellies and salad dressings.

The President of Alcan's food packaging business in North America, Ilene Gordon was quoted as saying "This business is a leader in its field, pioneering multi-layer bottle technology for hot- and cold-fill products," said the. "We are confident that we can find a strategic buyer that will be attracted to the growth and profit potential of the business, as well as by its commitment to providing customers with top-tier quality and service."

Alcan has been both expanding and restructuring its packaging division since 2002. The significant growth they have experienced has mostly been a result of acquisitions such as Algroup in 2000, VAW Packaging (FlexPac) in 2002 and Pechiney Packaging in 2003.

Through these and other acquisitions Alcan controls a substantial position in European, Americas and Asian flexible packaging markets. The packaging division expanded manufacturing capacity in Poland, Russia, China and Malaysia in early 2005. In Europe Alcan's packaging business has plants in the France, Germany, Czech Republic, Italy, Ireland, the Netherlands, Portugal, Poland, Russia, Switzerland, Spain and the UK.

Alcan now supplies the food, pharmaceuticals, medical, health and beauty aid, and tobacco markets with food and beverage packaging currently represents 62 per cent of sales in the packaging division.

The entire Alcan food group manufactures packaging for dairy products, pet food, fresh and frozen food, beverages, shrink bags, retorted food, dry food, and snacks.

"Our food packaging business is moving strategically to focus greater resources on the flexible packaging market, where we already enjoy substantial scale and leadership positions and where we believe the most attractive growth opportunities lie," said the president and chief executive officer of Alcan Packaging, Christel Bories.

Alcan is a leader in both the packaging and aluminum markets and has 70,000 employees and operations in 55 countries. Alcan’s packaging business alone had revenues of $6.1bn in 2004. The plastic packaging accounts for 59 per cent of the division’s business, while aluminum makes up 26 per cent.