On all levels, consolidation reigns in nonwovens

By Karen McIntyre, Editor | October 4, 2011

Last month, the big news shaking the nonwovens industry was the sale of Ahlstrom's wipes business to Suominen (this news was so big, in fact, it broke records for the most read news story on www.nonwovens-industry.com) and what it means for the global wipes market. This month, the big news is the rapid rate of consolidation throughout the nonwovens supply chain. A run down of this month's news stories includes the sale of machinery specialist NSC to Andritz, Indorama buying Wellman's PET business, Unicharm buying a Vietnamese fem hy maker and SCA's purchase of a Brazilian incontinence maker.

These announcements follow a trend in recent months of a number of mergers and acquisitions that not only consolidates the nonwovens and related industries but also helps its expansion. By acquiring existing companies in emerging areas, global conglomerates like SCA and Unicharm are buying access to these markets where their marketing and technology experiences will help those markets grow. This has been a trend among hygiene companies for years as they focus on expanding into growing regions.

Meanwhile, on the machinery front, Andritz' purchase of NSC last month is just the latest in a number of acquisitions shaping the machinery and equipment market. With its existing Küsters calendering and Perfojet hydroentangling technologies, Andritz continues to expand its already-strong nonwovens platform through the purchase of NSC's needleloom and related technologies. Moving forward, Andritz will be a large machinery conglomerate able to offer a number of options to the global nonwovens industry. Like Trutzschler, through its purchase of Fleissner a few years ago, or Oerlikon, through a number of purchases of different nonwovens technologies, more and more machinery companies are broadening their scope in an effort to keep prices down and options open to their customers.

In this period of consolidation, the same question always comes to mind. What will be the end result to the industry as a whole? While consolidation can mean great things from a economical standpoint – lowering costs and improving margins – what will it mean from a creative standpoint? Less competition means less motivation for innovation. Without new ideas and new products, it could be difficult for the nonwovens industry to reach the next level of new product development and expansion.

Of course, consolidation does not have to lead to stagnation. Let's hope the companies involved continue to stay on their toes, keeping ahead of the curve when it comes to new ideas.

Karen McIntyre

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