Valmet signed an agreement for the acquisition of the PMP Group in order to further strengthen its capacity to supply global paper, cardboard and tissue producers
For most of the companies, 2020 will be a difficult year to forget in the future, if one considers how the pandemic has disrupted the world economy and, as a consequence, their turnover. The difficulties encountered are unfortunately well known and have largely been debated, both in the most mature markets and in emerging economies. And yet, there are realities that, even in an unprecedentedly complicated year, have been able to stand up on the international scene for their sense of initiative and entrepreneurship, which we might well define “crisis-proof”.
This is the case of Valmet www.valmet.com with the transaction for the acquisition of the PMP Group, whose aim was to further strengthen its capacity to supply global paper, cardboard and tissue producers. The PMP Group supplies process technologies and services for tissue, board and paper machines globally, focusing on small and medium-sized tissue machines and on the building of board and paper machine.
The combination of the two companies’ product portfolios, as well as of their respective competence and presence in strategic markets, will create new business opportunities, as explained by Jari Vähäpesola, business line president, Paper, Valmet. The acquisition will, indeed, bring two companies with different offerings and customer segments together.
First of all, what conclusions do you draw on the market for 2020? How did you face the Covid-19 crisis?
«Market activities have been good in 2020. At the end of the first quarter of 2020 our order portfolio was at the same level of the corresponding value of the year before. The peculiar aspect for this year was the strong business activity in China, which has generated over 50% of our orders.
Covid-19 has represented a challenge for all of us. It imposed a restriction on our movements, personal contacts with our clients and field operations. And yet, at the same time it has brought about an increased use of the most recent digital tools. Together with our customers, we have increased our remote work and support through our Performance Centres and our Industrial Internet applications».
How does the recent acquisition of the PMP Group fit in this scenario?
«The acquisition of the PMP Group brings together two companies with a differentiated offer, which are, however, mutually complementing. The PMP Group supplies process technologies and services to small and medium-sized businesses in the tissue sector. Valmet’s strength currently lies in the technology and services for bigger and fast machines, and for rebuilds. This combination creates a strong entity, which is capable to reach a much larger market and offer the widest technological offer in this industrial sector».
What characteristics of the PMP Group you convinced you of the need to acquire it?
«This acquisition has reinforced our technological offer and business in the service sector globally, as well as our presence and local capacities, thereby representing added value for our customers. This acquisition is strategically important, as it contributes to reinforce Valmet’s business globally in the paper sector, it is complementary in technology and at the same time it further consolidates our global presence and capacity, especially in Asia and China».
What will change for you after this business transaction?
«With the adding of the “Intelli” product family, Valmet will boast the widest product range in the world, including the Opti and Intelli technologies for paper and cardboard, as well as the Advantage and Intelli technologies for tissue customers. Furthermore, our offer includes service, automation and Industrial Internet solutions for paper, cardboard and tissue producers.
We also reinforced our main competences with additional 650 dedicated personnel. Our main offices are now in Jelenia Gora and Swiecie in Poland, and Changzhou in China. We have one plant in South Beloit, United States, and one in Lucca, Italy.
The acquisition will mainly bring about benefits, as we do not have any overlapping offer and our new facilities in Poland and China will increase our capacity in strategic countries.
A new and stronger Valmet will provide better customer care, support problem-solving and identify added-value opportunities. In the meantime, we wish to make sure that ours ales and project contacts remain unchanged and the flow of our activities will continue as normal. Ongoing projects will continue according to plans with the same working groups, as has always been done in the past».
What business strategies are you going to develop in 2021?
«We will continue using the digital tools that have proven to be of help during the Covid-19 pandemic and have enabled us to support more customers in remote in a fast and effective way. Producing paper with the lowest environmental impact is an extremely valuable guideline for us. We are, furthermore, focused on reducing the use of raw materials and energy consumption, without compromising paper quality parameters at the same time. Our objective is to replace the use of plastics, which will bring about new opportunities for fibre-based products, like the 3D project we are currently developing with Metsä Spring.
We are, furthermore, witnessing an increased interest in China for hybrid concepts applied to tissue paper, which enable the sustainable production of tissue paper of premium quality with the use of less fibers and a lower energy consumption.»
Will there be new business opportunities for the Italian market now?
«Italy is a primary market for Valmet. Many of our main customers are based in this country. We have also provided a number of cardboard machines in Italy, e.g. the machine for production type conversion delivered to Burgo Verzuolo and the new Pro-Gest line in Mantua. Our installations in Italy offer a solid base for our business service and the new operational offices in Gorizia and Pescia are extremely important for our tissue technology».
A new year has just started: what do you expect from 2021?
«I hope that the Covid-19 pandemic will soon be over and that we can go back to business as usual soon, however at the same time I also hope that we can make the most of the lessons learnt in 2020. We will naturally continue developing our business and offer, and we will take advantage of the entire potential emerged from us joining forces to become an increasingly solid company and cover the entire range of products and services offered to all customers and on any market».