Sweden's Rapid Granulator AB has boosted its presence in recycling equipment by acquiring Avian (Shanghai) Machinery Co. Ltd., along with its 540,000-square-foot plant and well-established China distribution network.
Privately owned, Shanghai-based Avian claims to be the second-largest Asian manufacturer of granulators and equipment for post-industrial and post-consumer recycling markets. The Avian plant is almost 17 times larger than the 32,000-square-foot plant Rapid shares in Shanghai with sister company Conair Group Inc. That plant will be shuttered over the next six months.
This gives us more machinery and equipment in the recycling markets, and an opportunity to manufacture products closer to markets and reduce transportation costs and lead times, said Rolf Gren, CEO of Rapid Granulator.
We needed to get closer to Asia to serve that market better in both production and service, he said in a June 22 interview before an NPE2009 news conference in Chicago, where the company announced the acquisition. Gren has said that the company expects Asia to account for one-third of its sales by 2011.
Rapid will move its current production in Shanghai into the Avian facility, which now is using only about half its space, he said.
This is a move into China to serve that market, not a move to China, he emphasized. We are not closing any plants in Sweden, the U.S. or anywhere else except for its existing Shanghai facility. The facilities we have around the world will stay and be growing.
Avian will remain an independent brand with its own distribution network, Gren said, and general manager Mark Miao and the rest of the management team at Avian will remain in place.
The manufacturing transition in China will start in July and should be completed by year-end.
Avian makes pulverizers and larger granulators, which had been a product gap for Rapid.
We are very good at manufacturing in-house granulators. They are very good at making equipment for recyclers. Our product lines complement each other, Gren said. It gives us a chance to move into the global post-industrial/post-consumer market quickly and to have a pulverizer portfolio as well.
Gren added that he expects Rapid to have new products for global distribution in 2010 as a result of the acquisition.
This is a growing and emerging market and the growth opportunity is significant, said Chris Keller, president and chief operating officer of International Plastics Equipment Group Inc. in the Pittsburgh suburb of Cranberry Township, Pa. IPEG, the parent of Rapid Granulator, was formed in 2000 to manage the plastic equipment holdings of Sewickley Capital Inc., which also include Conair.
Rapid Granulator is based in Bredaryd, Sweden, with its U.S. operations based in Franklin, Pa.
Gren called the acquisition the second step of Rapid Granulator's strategy to have a larger global presence the first being the acquisition almost two years ago of Moditec srl of Marennes, France.
Moditec makes slow-speed, high-torque granulators with single and twin shafts. The granulators also use patented metal-detection technology that instantly shuts down a grinder if metal enters the cutting area, to protect the machine from damage.
This is an important step for IPEG group and the industry. The industry needs to consolidate, Gren said.
Keller echoed that thought, adding that the recycling market is important because the world now sees that it has a need to reuse and recycle what it uses.
Rapid has annual sales of roughly $45 million and employs 265. Avian has a workforce of roughly 280, said Gren, who did not disclose Avian's annual sales.
Rapid also is introducing to U.S. markets several lines of equipment it first unveiled at Germany's Fakuma 2008. The equipment includes its 600-series open-hearted granulators, designed to create easy access to rotors and cutters to reduce downtime during production changes by 50 percent.
An operator can gain access to the rotor and other core parts of the granulator by opening two doors and lifting a top, with no need for any tools, said marketing manager Bengt Rimark.
With shorter pit stops, the downtime will be significantly less. You can service the entire granulators the screens, the rotors, the cutters in two minutes, he said.
Rapid also unveiled for the U.S. market its modular silencing system with transparent sound-absorbing fabric that can lower noise levels from granulators, compressors, pumps and other equipment by 10-20 decibels, and its next-generation line of eight slow-speed, RG-Series screenless granulators with the integrated metal-detection system from Moditec.