Heidelberg has agreed to sell Gallus, its narrow web printing division, to Switzerland’s benpac holding.

benpac is a group of companies offering packaging technologies, engineering, IT technology and consulting. Headquartered in Stans, Switzerland, the group is primarily active in the US and across Asia.

The transaction sees benpac assume ownership of Gallus Holding AG in St Gallen, Gallus Ferd. Rüesch AG in St Gallen, Gallus Druckmaschinen GmbH in Langgöns, Heidelberg Web Carton Converting GmbH in Weiden in der Oberpfalz, and Menschick Trockensysteme GmbH in Renningen. These five sites represent some 430 employees in Germany and Switzerland.

With an agreed purchase price of some €120 million, Heidelberg is expecting the deal to generate earnings in the mid two-digit million euro range. The parameters will be finalised at the time of closing. The sale, which still needs to be approved by the relevant bodies and is subject to other condition precedents, is set to take effect before the end of 2020.

benpac and Heidelberg have agreed that Heidelberg will continue to manage the sales and service of the Gallus portfolio in close cooperation after the takeover. Gallus customers will therefore continue to benefit from the proven quality and reliability of the world’s largest service network in the print media industry.

With production facilities in Switzerland and Germany, Gallus develops and manufactures both conventional and digital narrow web rotary label presses. The machine portfolio is complemented by a range of screen printing plates (Gallus Screeny), decentralised global service activities, and a comprehensive selection of accessories and spare parts. Heidelberg Web Carton Converting provides high-end web-fed printing technologies for folding cartons.

For Heidelberg, the divestment of Gallus allows it to focus on its core business of sheet-fed printing.

Heidelberg CEO Rainer Hundsdörfer explained, ‘We are selling our narrow web rotary and rotary flexographic printing activities to focus more closely on innovative solutions for the entire printed sheet value chain.’

In the future, Heidelberg and benpac will work together closely on the Gallus Labelfire hybrid flexo-digital label press. Heidelberg will continue supplying the digital printing unit (DPU) and consumables for this press.

Mr Hundsdörfer continued, ‘We will be retaining our in-house digital expertise and, by collaborating with benpac on the Gallus Labelfire; we will also be making further progress with the digitisation of conventional presses. At the same time, we will remain a major supplier in the growing label market with our sheet-fed offset presses.’

Heidelberg has been carrying out a number of moves to transform and reposition the company. This has included ending development and sales of Primefire 106, and investing in the production of printed and organic electronics.

Heidelberg CFO Marcus A. Wassenberg added, ‘Our aim is to ensure the long-term financial stability of Heidelberg, and all the measures since our transformation started in March this year have been geared toward this objective.

‘Selling the Gallus Group is another key part of our realignment and follows on from the successes we have achieved so far during the transformation process. This further major boost to our liquidity and group equity will be a big help, especially during the coronavirus crisis.’

For benpac, the acquisition, ‘is of great strategic importance,’ according to CEO Marco Corvi.

‘It completes our overall range in the packaging sector and ensures that the entire value chain is covered. The expertise of the Gallus Group will contribute to the further development of our group of companies.’

Former Gallus senior executive Christof Naier is the current CEO at benpac holding, having moved over in May prior to the acquisition.