Veka plans investment following Bowater deal
WINDOWS maker Veka is planning a series of investments in its Burnley base following its takeover of larger rival Bowater Building Products in June.
Managing director David Jones said that the firm has begun reshaping its 380,000 sq ft plant with a view to accommodating much of the production facilities carried out by Bowater at its Minworth base, which is close to Sutton Coldfield.
A new £2m mixing plant which will increase recycling rates of old windows will be added, and it will take on stock from a Bowater warehouse at Midpoint in the West Midlands whose lease is due to expire by the end of the year.
Jones has set an 18-month timetable for the integration of the Bowater business into Veka, which he said would include increased levels of investment and jobs in East Lancashire.
Veka is a German-owned maker of PVCu windows, which employs around 3,000 people worldwide and has turnover of around €700m. In the UK, it has been operating from a plant in Burnley for 25 years.
Last year, it employed around 150 people and turned over £28m. The Bowater deal, however, creates a business with a combined turnover of £50m and around 400 employees.
Jones said: “A while ago, I gave our German parent company a number of scenarios about what would happen with the business based on various levels of investment. They have invested and we’re now no.1 in the UK.”
He added: “We haven’t just bought this business – we’ve bought it with a view to investing.”
The first significant sign of this will be the new mixing plant, which will get underway later this year and be ready by the end of 2012. A composite door making business started by Veka as an online-only operation three years ago which now turns over £2.5m is to be relocated to a similar site run by Bowater from its Coventry base. It turns over around £6.5m.
Further development of Bowater’s main manufacturing plant at Minworth, near Sutton Coldfield, is also planned.
Jones said that the deal brings together two of the premier brands in the industry – its own Veka brand and Bowater’s Halo brand.
“The Halo range is a well-specified product. Through some calculated investments, they’ve been pretty innovative,” he said.
He added that both brands had held up market share during the recession, arguing that “premium brands do better” when money is tight. There is also “hardly any overlap” between customer bases, and both brands are being retained.
A closer integration is taking place at operations level, though, with Jones keen to spread the Veka culture to Bowater staff. Jones believes the main difference they will find will be in Veka’s openness.
“We’re completely transparent in what we do,” said Jones.
“We want to be an employer of choice and we want people to come and work for us.
“I suppose there may be a bit of scepticism, but what I’ve said to people is ‘Don’t believe what I say, believe what we do’.”
The firm has held a couple of open days recently where it has brought staff from Bowater’s Minworth plant up to Burnley with a view to encouraging them to relocate.
“If we got 20 to come up, that would be fantastic,” he said. “We have the facilities here where we can drop that size of business into our operations.”
Indeed, he added that the firm could probably bolt on another acquisition to its huge Burnley site before it reached capacity, but said this was not likely to happen in the immediate future.
“The timing is not right until we get this one bedded in,” he said.
