Amid all coverage on the fallout of Covid-19, some news is getting less attention than it should. Consider, Komori acquiring the MBO group . Folding is a central process for many print products and few printing companies do not own a folder.
In the domain of high speed, full size folders MBO is a leading company – together with Heidelberger Druckmaschinen. There are other manufacturers who are much smaller in size, like GUK), who focus on smaller formats up to B2 and Horizon which recently moved into B1).
The MBO group offers a variety of post press equipment, including stacking, bundling, cutting, delivery, but their main focus is on folding. In addition, the company dominates the market for complex folding of thin paper, such as found in pharmaceutical packaging through its subsidiary Herzog and Heymann, acquired in the year 2000.
In 2018 Heidelberger Druckmaschinen tried to acquire the MBO group. Already back in 1998 Heidelberg bought Stahl folder (including subsidiary Baum folder) and is a major folding machine supplier ever since. The German anti-trust office held up the MBO acquisition based on the dominant market position that would be created by combining the two biggest competitors. (See article). According to the findings both companies would have had a combined market share for performance folding equipment of 60-70% in Europe. It is interesting to note that while Heidelberg sold off substantial parts of its post-press business in recent years manufacturing of folders is still a key area.
What’s in the Deal:
What is in it for Komori? With MBO Komori is acquiring a solid post-press equipment manufacturer, having achieved sales of €51.7 million in 2018. This is helping to diversify the Komori product portfolio. MBO serves a fairly stable market as folding is an essential part of many print production processes regardless of using analogue or digital print. MBO can also be a door opener into printing companies Komori had no good access to before.
What is in it for MBO? Although MBO is already selling globally, Komori can certainly help in serving additional, developing markets. More crucially however Komori is very active in digital print and has its own workflow system: KP connect. Achieving an ever-closer integration into the whole factory workflow and supply chain is getting ever more critical for post press equipment, especially as runs are getting shorter and deadlines tighter. However, most post press equipment manufacturers are small and do not have the resources and know-how in software and networking development to keep up with the needs of industry 4.0. A parent company like Komori could help a lot here.
What’s in it for Printers
Printers can potentially benefit from improved equipment and software. For other industry suppliers it gets a bit more dicey however. Folding is a critical part of the print production process and automation is a pressing issue in the print industry and closer integration of folding is very desirable. This can extend into full in-line folding. MBO does provide in-line folding functionality to other – mostly digital – press vendors or for integrated post-press lines. With Komori having competing products this is getting less likely in the future. Additionally, MBO is the only supplier of very large format folders – for presses manufactured by König & Bauer or Manroland – but not by Komori.
Can MBO keep up the integration focus?
It is probably not a coincidence that Heidelberg/Stahl was noticeably less active in working together in in-line finishing with other (digital) press vendors or setting up integrated finishing lines with other manufacturers. Folding will remain the focus of MBO long after Komori acquired MBO. According to MBO CEO Thomas Heininger, “The brands of the MBO group will be retained including the current manufacturing sites. MBO also pledges to continue to support the Post-press Alliance of several finishing manufacturers to demonstrate automation and interconnectivity.”
Still, I would expect that the cooperation with other manufacturers will slow down in the future. This is not so good news for a tighter integration of processes and for lifting the automation level in the industry. Mechanical integration (in-line finish or post-press lines) and integrated, seamless data flow will rather increase in importance in the future. There are other folding equipment manufacturers, but now the two biggest ones are tied to press vendors.