January 27, 2014
Rosti AB, the privately-owned plastics processor, will invest 60 million euros ($81.9 million) across the business in the next two years to help it achieve its annual turnover goal of 600 million euros ($819.9 million) by 2017.
The company has also announced that it is closing its factory in India, with the loss of 100 jobs.
The company based in Malmo, Sweden, which was acquired by Swedish family-owned investment firm Nordstjernan in 2010, will plow some of the funds into Rosti McKechnie's plant in Pickering, England, where the company makes parts for automotive customers including Jaguar Land Rover.
Money will also go into extending the firm's packaging plant in Dresden, Germany, by a further 32,300 square feet, while at its operation in China will add 43,000 square feet of space, all to accommodate new business.
Investment in Pickering will include 20 injection molding machines up to 2,700 metric tons, an extrusion line and a new painting plant – currently being built.
Tez Kurwie, Rosti's sales and business development director, told PRW that when the business was acquired by Nordstjernan four years ago Rosti was then a 200 million euro ($273.3 million) business and had set itself a target of hitting an annual sales target of 400 million euros ($547 million) by its 2014-15 fiscal year.
"We achieved that goal in 2013. So now we set ourselves the goal of reaching 600 million euros by 2016-17," he said.
Part of that growth would come through organic growth, supported by the latest investment program, and part through acquisition, Kurwie added.
"Looking at our return criteria [of 8 percent sales growth per year] it was clear we are not going to hit 600 million euros through organic growth alone, so we are proactively looking at buying businesses generating in excess of 50 million euro ($68.3 million) turnover."
Kurwie said Rosti was casting its eye over the U.S. and Mexico, where it had had businesses until the Nordstjernan deal in 2010, at which point these were sold to management.
Brazil was also on Rosti's radar, Kurwie added, while the company was on the lookout for business opportunities in Western and Eastern Europe.
As well as its investment plans, Kurwie revealed that Rosti had closed its plant in Chennai, India, which manufactured products including business machines and consumer electronics goods.
"In 2008 we were invited by two customers to establish a plant in Chennai. They have subsequently decided to align themselves away from that part of the world and as a result we have had to close the plant," he added.
Around 100 jobs have gone and the factory's 12 machines have been redeployed to Rosti's other Asian operations.