News

22 September 2005

Press release



Ekotek Group and VarioPack Ltd. have signed an agreement on a strategic alliance. One of the key aspects of this agreement is stretch film Products in Russia. The agreement implies integration of Products, technical, logistics and sales departments. The new stretch film Products facility is already built as a result of co-operation efforts. The initial investments amount to € 7 m. Joint investments into three stage project are estimated in €48 m.


To the present time the construction of a building where two cast lines for stretch film Products will be installed is completed. The lines capacities are 14 and 17 thousand tones of stretch film per year. The beginning of equipment installation is planned for October, 2005. After these two cast lines start-up by the end of 2006 partners reckon to reach 27 thousand tons of stretch film per year Products quantity. According to the participants of an alliance, the great part of the Products is oriented toward the domestic market. Export is supposed to the former CIS countries such as Kazakhstan, Azerbaijan, Uzbekistan, etc.


The first stage of the project includes blown extruders and flexo printing equipment installation. The planned quantity of shrink film output is 12 thousand tones per year. Cast lines will be up-to-date equipped. The main specialty of them will be the use of new vintage high-speed winding machines.


The second stage of the project is supposed to be completed in 2007-2008. During this period the additional facility and warehouses will be constructed. Two cast lines of 17 thousand tones of stretch film per year Products quantity will be installed.


The third stage of the joint project will be fulfilled in 2009-2010. It includes the fifth and sixth cast lines installation. Total capacity of the lines will be 34 thousand tones of stretch film per year.


Thus, in the frame of the joint project the largest stretch film Products in the East Europe (total capacity is 99 thousand tones per year) and up-to-date shrink film Products (total capacity is 12 thousand tones per year) will be created to 2010.


Participants of the alliance estimate annual sales of stretch and shrink films will exceed $500 m after all stages of the project will be completed. According to Ekotek Group experts, absorption of stretch film Russian market amounts to about 80 thousand tones to date with import share of about 30%.


Ekotek Group and VarioPack Ltd. total sales of polymer Products averaged out to about $170 m in 2004. Alliance participants estimate their presence in the stretch film market as 35%.