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Friday, November 5, 2010

Hayleys enters local market-focused manufacturing sector

Acquires 95% stake in aluminum extrusions leader Alumex Group for Rs. 2.2 b

Export rich Hayleys yesterday acquired Alumex Group, the leading manufacturer of aluminum extrusions for Rs. 2.2 billion.

The acquisition of 95% stake in Alumex Group holding company Alutech Anodising and Machine Tools Ltd. was executed at Rs. 2.185 billion. The balance 5% stake is held by the entity’s senior management.

Sources said that the acquisition heralds Hayleys into the manufacturing sector serving the local market. The diversified blue chip has been largely engaged in manufacturing for exports.

Alumex has five subsidiaries in its business portfolio employing 400 people. It enjoys a 55% share of the country’s aluminum extrusions market. Founded by the Williams family in 1988, Alumex is the only ISO 9001:2008 certified aluminum extrusions manufacturer in Sri Lanka whilst its product portfolio conform to relevant international standards as well.

Industry analysts estimate that the country’s aluminum extrusions market is worth slightly over Rs. 4 billion per annum with around 30% being sourced from abroad. Apart from market leader Alumex the other major local player is Ceylon Aluminum. Analysts said that contrary to the global phenomena of aluminum being cheaper than wooden fittings, in Sri Lanka the former is expensive. This to a large extent has deprived a bigger market and higher growth for aluminum extrusions.

Under Hayleys ownership Alumex is expected to carve out a strategy to make aluminum extrusions more affordable thereby widening its market further. The impending boom in commercial and individual construction in post-war Sri Lanka is expected enhance scope for the domestic aluminum extrusion industry.

Alumex is the fifth acquisition by Hayleys in recent times with the previous major investments (directly taking control or increasing minority stakes to controlling) being Ceylon Continental, Hunas Falls,Talawakelle Plantations and MGT Textiles.

Alumex has a state of the art manufacturing facility on a 7 acre land within the Sapugaskanda Industrial Zone. Facilities include a modern extrusion, anodising, polished anodising, alumex wood effect and powder coating, DC casting. These are in addition to an in-house plant to produce aluminum extrusion dies using CNC machinery such as CAD/CAM technology for dye designing and manufacturing.

Alumex staff has a wealth of experience spanning 20 years in the Aluminum Industry and the Group boasts of having its own technologies in innovating Aluminum Extrusions to cover various industries from Architectural to Engineering applications to domestic and is equipped to manufacture tailored solutions aligned with all its customer needs.

All the material used in Alumex processes are from world-renowned manufacturers. Such as, Aluminum Extrusion Billets from an internationally renowned DUBAL – The world’s largest single smelter site, U.A.E, Chemicals for anodising is supplied by SurTec (BEFELD System and LC System), Germany and France, Powders for powder coatings is supplied by Orica/ Dulux, Australia & Jotun, U.A.E.

source - www.ft.lk