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Avery Dennison in takeover of rival Jac

Friday, 21 September 2001
By Print 21 Online Article

Major consolidation is likely to result as the local market has a considerable over supply of production capacity. Avery-Dennison, previously known in Australia as Fasson, has its laminating plant in Adelaide, while Jac, officially Jackstadt, is located in Melbourne.

Industry sources estimate that both companies have approximately the same share of the market, with Finnish rival Raflatac a close third with between 20 and 25 per cent. Kari Palli, regional managing director of Raflatac, sees the takeover as an opportunity to gain market share.

“In these matters one and one never adds up to two. You’ll always find some customers who don’t want to deal with the larger company,” he said.
The deal is dependent on approval by national competition authorities but it is not anticipated the ACCC will become involved. However the local companies are tight lipped with all inquiries directed to a public relations company in Hong Kong and thence to Germany.

The US$400 million all cash sale was not unexpected as Jac, although once dominant in Australia and New Zealand, has been losing market share in recent years and has struggled in a number of markets overseas.

“The combination of our two companies, both industry pioneers, will create value for Avery Dennison shareholders, while providing substantial benefits for customers and new opportunities for employees of both companies,’ said Philip M. Neal, chairman and chief executive officer of Avery Dennison.

“Our management and employees have built one of the truly prominent companies in our industry over the past 50 years,’ said Dr. h.c. Werner Jackstadt, chairman of Jackstadt. “We are pleased that the JAC brand name, headquarters and business operations will play a continuing role in Avery Dennison’s future.”

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