Joint venture between Polytype and Huaying

ICE daily: “What benefits do you expect from the cooperation between your companies?”

Detlef Merklinger (CEO Polytype Converting AG): “The general idea is that Huaying will continue to promote their existing machine portfolio under the brand Huaying. In addition to that we have selected a common range of machinery which will be promoted under the brand name Polytype-Huaying. If Huaying for example builds a 300 metre silicone line with our components then it will be sold with our common name.”

ICE daily: “Will these machines also be used outside the Chinese market?”

D. Merklinger: “These machines are made either for the local Chinese market or for markets where Huaying is already selling today. Indeed about 80% of Huaying machines are located in countries where we as Polytype do not have any sales activities.”

Xu Peng (General Manager Huaying Soft-Packging Equipment): “Polytype is very famous in this industry, they have a lot of experience. During recent years Chinese packaging producers have more and more

realised that coating gives added value to their products and also can bring new business opportunities for them. More and more users pay attention to new coating technologies. The collaboration with Polytype will optimise our manufacturing skill and will give our customers better services.”

ICE daily: “What is the structure of this joint venture?”

D. Merklinger: “Polytype bought 20% of the Huaying shares. The total value of the deal is 1 Million Euro, to be paid partly in cash and partly in know-how transfer. We ensured the possibility to extend this contingent. We really want to have a long-term relationship and wish to support Huaying on their way. For this reason we also have 30% of board voting rights. That means we’re not only investors, we really have the chance to discuss together the strategy for future business areas. Our goal is to be successful together.”

ICE daily: “What are your concrete goals?”

D. Merklinger: “For sure Huaying is interested in getting components and knowledge from us to extend their business in Asia. Our interest is that we are able to supply a `beginner generation´ of machines to get a foot inside the Asian market and get in contact with customers who might be interested in high level Polytype lines later on. Another point is that we would like to improve our service situation in China: With a service partner such as Huaying we can optimize serving our machines and get support in installations.”

ICE daily: “Will this strategy effecct your European customers?”

D. Merklinger:“We are certainly not considering manufacturing certain elements in China for cost reasons and then selling them to our best clients in Europe or overseas. What we are doing is to put Huaying in the position to be able to enter a market in which they are currently not a player. By doing so we help to make the Polytype brand better known, which can help us win new customers in the future. At the same time we can increase our level of service to our existing client base in China, which we already serve with the help of Huaying. Another consideration of ours is to build our series of flotation dryers for Asian installations with Huaying instead of in Germany. In summary, the cooperation with Huaying is for us an add-on business and we don’t want to substitute anything but is a means to find new ways to enter new markets.”

ICE daily: “Will you still employ your own Polytype sales staff for the Chinese market?”

D. Merklinger: “The cooperation with Huaying is specifically restricted to the upper commodity market. All other lines are built as normal in Switzerland and sold by our own Chinese salesperson.”

Esa-Matti Aalto (Business & Operations Manager Pagendarm BTT GmbH): “If we consider the drying technology market, we are not looking at the upper end of the pyramid. Indeed we will offer dryers just for the Chinese market which are no longer sold in Europe by Pagendarm BTT.”

Download ICEdaily-Interview