Bosch to sell US$1.5bn packaging machine division

02 Jul 2018 --- German engineering group Bosch has announced that it is exiting packaging. Bosch is now looking for a buyer for its packaging machinery business (PA), more specifically, the pharmaceuticals and food units of the Packaging Technology division. The group plans to refocus its energies on the digitalization market, including the internet of things, for example. The aim is for all of the divisions of roughly 6,100 associates in 15 countries to be retained by the new owner and the units will remain a stable partner for its customers.

The company notes that reasons for the decision include a desire to focus its resources on its core business, a lack of business or technology synergies within the group and that small-medium enterprise (SME) rivals are at a structural advantage in the packaging technology market.

Dirk Haushalter, a Bosch press spokesperson, tells FoodIngredientsFirst, “It is important to be clear that all companies and Bosch is no exception, continuously pursue a strategy of keeping themselves competitive. This includes constantly reassessing the market and reacting to changes there. For this reason, Bosch is continuously examining ways of appropriately adjusting its entire portfolio of products and services, as well as the way its units are organized.”

Te, Bosch is reorganizing in order to focus their attention elsewhere. “This decision will allow Bosch to narrow its focus on issues of importance for its future, such as the transformation of the Bosch Group and its future digitalization strategy, including the internet of things, and to pool its resources accordingly,” says Dr. Stefan Hartung, the Bosch Board of Management member responsible for the Energy and Building Technology and Industrial Technology business sectors.

“Both PA and Bosch will benefit from this decision. A reorganized packaging technology business will be able to adapt more flexibly to the diverse requirements of this typically SME market, while Bosch will be free to focus its attention entirely on the group’s impending profound transformation,” Hartung adds. “It also is the Bosch Group’s strategy to structure its operations competitively. Consequently, it continuously adjusts its business fields and it is in this context that this decision has to be seen.”

The company stresses that Bosch packaging machinery enjoys an excellent reputation in the various industries in which it is employed. Its innovations have recently garnered awards, instilling a sense of confidence in the company for future business success. Haushalter tells FoodIngredientsFirst that it is too early in the process, however, to express a purchasing price.

“My colleagues in PA executive management and I are confident of future business success. We’re one of the biggest companies in our industry, and the path we have chosen is clearly the right one. We will stay together as a strong and stable unit. Under new ownership as well, our tried and tested team will continue to provide our customers with excellent manufacturing solutions and services,” says Dr. Stefan König, Chairman of the Managing Board of Robert Bosch Packaging Technology GmbH. “PA has always led a largely independent existence within the Bosch Group, and will in the future be able to respond even better to the requirements of the packaging industry. Our customers will benefit from this.”

From a business perspective, the past two fiscal years were difficult for certain PA units. Under new management, however, the company says that it has begun to realign, with some initial success. Many units are now in a good position to serve the growing market. In the years ahead, the company expects to see increasing demand. With its many technological USPs, the pharmaceuticals unit is developing encouragingly and growing. The food unit has strengthened its core areas and intends to expand its market position further.

By Laxmi Haigh