India's largest glass containers manufacturer Hindustan National Glass & Industries (HNG) plans to invest around 7 million euros in its newly-acquired German subsidiary HNG Global GmbH to make it one of the most advanced production centres for glass containers in Europe.
The Kolkata-based company's purchase of the assets of the insolvent German company Agenda Glas AG in Gardelegen, in the state of Saxony Anhalt, is an important building block in the firm's global expansion plans, its Vice Chairman and Managing Director Mukul Somany told PTI.
It has given the company a foothold in Europe, where the marketing opportunities are great for a wide range of glass bottles it makes for a variety of industrial use, he said.
Somani said immediate task is to stabilise the operations of Agenda Glas AG, which was threatened with bankruptcy. HNG will use its experience in successfully restructuring about half-a-dozen under-performing units in India to transform its new acquisition into a profitable business.
Somani expressed hope that the plant could be rehabilitated soon and it could reach full production capacity within six months.
Agenda Glas AG was founded in 2008 with an investment of around 50 million euros and it began commercial production in early 2010. It has a production capacity of 320 tonne per day of glass bottles for the alcoholic and non-alcoholic beverage industries.
However, the company filed for insolvency a year later in February, 2011, because its turnover of around 10 million euros in 2010 was far below its expectations, according to insolvency administrator Lucas Floether.
Somani said Agenda Glas AG was a new facility with latest technology and it will enable HNG to enhance its technological strength and production processes in order to penetrate the European market. Its location at the heart of Europe is quite ideal not only to serve the markets in Germany and in neighbouring countries, but also to expand to the rapidly growing markets in central and eastern Europe.
The new company will keep about 120 workers of Agenda Glas AG and it will continue to be managed during the transition period by the present management team.
HNG is the market leader in India's glass packaging segment with a share of 55% and it produces 2,625 tonne per day of glass containers ranging from 5 ml to 3,200 ml with applications in the alcoholic and non-alcoholic beverages, pharmaceuticals processes, food and cosmetic industries.
The company had a turnover of 242 million euros during the current financial year and exports to over 23 countries in Europe, North America, West Asia and Africa had a share of 5%.