The biggest global name in processing equipment, Mannesmann Plastics Machinery AG, has had a turbulent year.
The headlines have changed so frequently in Munich that if you haven´t been paying attention, you might be surprised to hear that MPM now is for sale. The company owns the Van Dorn Demag, Demag Ergotech, Krauss-Maffei, Netstal, Billion and Berstorff product lines.
From processors´ point of view, it would be best for MPM to find new owners with deep pockets and a commitment to support fresh research and development.
MPM also hopes to find a single buyer willing to keep the whole unit together. But processors may have mixed feelings about that part of the plan.
After all, a new owner will be tempted to make changes that could spell less competition, which is counter to processors´ interests.
Anyway, it´s easy to dismiss MPM´s ability to control its own destiny. Just take a look at the year in review:
* First came the planned initial public offering. Parent company Mannesmann AG announced it would spin off its engineering, automotive and machinery business with a separate company called Atecs. MPM would have been included in the IPO.
* Next came a bit of controversy. The IPO plan fell apart when Vodaphone AirTouch plc attempted a hostile takeover of Mannesmann AG. The effort by the Newbury, England-based company to buy a German rival stirred lingering nationalistic feelings on both sides of the English Channel, but the two sides eventually called a truce and agreed to merge.
* Then, a trio of white knights rode to Atecs´ rescue. First, Thyssen Krupp AG hoped to scoop up the company. Then, in April, Siemens AG and Robert Bosch GmbH created a joint venture to take over Atecs.
At that point, MPM´s pitch was that Siemens and Bosch had promised to avoid interfering with Atecs´ management and business structure for three years. But that pledge didn´t hold up for long: Siemens and Bosch quickly carved up Atecs, and on Nov. 22 Siemens announced that it was soliciting buyers for MPM.
All told, it was an incredible tale for a machinery business that took years to assemble. MPM officials are mindful of all the effort they put into creating this global powerhouse. So it´s only natural that they´re taking a hard line about keeping MPM in one piece.
Even if a single buyer does emerge, MPM is in for significant strategic changes.
Today, each MPM unit is encouraged to compete with the others, even while benefiting from the advantages of common ownership. But the theoretical single MPM buyer naturally would look for ways to trim expenses, which could result in less competition.
Change at MPM is unavoidable, which is one reason its corporate owners have had such trouble deciding whether to keep, sell or spin off the company.
One thing is clear: It won´t be easy finding a buyer willing to invest in MPM´s units and keep them competitive. But that´s exactly what a piecemeal sale could accomplish.
