Heidelberg has announced its planned sale of Gallus Group to Swiss packaging company, benpac holding ag, has not been completed.
The German print technology manufacturer said benpac was due to pay 120 million euros ($A190m) to Heidelberg by February 1, the day that was agreed upon to close the deal.
But as this has not taken place, despite the necessary conditions being met, Heidelberg says it will now examine various options for the corporate future of Gallus.
The five sites and 430 employees of Gallus Group will now remain under the Heidelberg umbrella.
“Nothing will change for Gallus customers. Heidelberg will continue to handle sales and service for the Gallus portfolio and their personal contacts with remain the same,” Heidelberg said in a statement.
“In any case, Gallus will continue on its path to boosting operating performance: with an independent set-up and specific focus on its flexographic printing market, Gallus made good operational progress last year under the Heidelberg umbrella.”
Gallus Group is based in Switzerland and produces conventional and digital narrow-web reel-fed presses designed for the labels and packaging business, including the Gallus Labelfire press.
Heidelberg bought the business in 2014.
Heidelberg announced last July that it would sell the business unit to create the financial scope for its realignment strategy.
A statement from Heidelberg says regardless of the deal with benpac not being completed, the company is benefiting from the transformation program launched in the current 2020/21 financial year.
It says the transformation program is to designed to: “further stabilise the company financially in the challenging COVID-19 environment and to align it in a future-proof manner in its profitable core business.”
The statement adds that since March 2020 net debt has been reduced by more than 250 million euros from a peak of 390 million euros and that liquidity has been improved by around 450 million euros.
“As a result of the accelerated M&A program, Heidelberg will generate proceeds in the mid-double-digit million euro range from the transactions completed in December 2020 alone,” the statement said.
Heidelberg says the market remains challenging due to the COVID-19 situation.
“Heidelberg is therefore systematically continuing its transformation course with the measures initiated for this purpose in order to create further financial scope,” the company said.
“In operational terms, the third quarter of the current financial year saw a continuation of the upward trend in sales and incoming orders that has been ongoing since May 2020. Heidelberg continues to expect to achieve its targets for financial year 2020/21 (ending March 31, 2021).”
Comment from Heidelberg’s local representative was sought for this story but Sprinter was referred to the official press communication from Heidelberg headquarters to avoid any confusion in the markets.
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