29.04.2011 | ALTA STRENGTHENS TECHNOLOGICALLY

ALTA STRENGTHENS TECHNOLOGICALLY

On March 4, 2011, signing the final documents completed the acquisition of Alta company concerning the purchase of Škoda Machine Tool (hereinafter referred to as ŠMT), which was owned from 2005 by the Russian company StankoImpex Group. Prior approval was obtained from the Office for the Protection of Competition.

The existing production engineering portfolio of the group of companies owned by the Alta Group, which consists of a supplier of heavy and medium-sized supplier portal machining centres and machining centres with a movable stand represented by TOS Kuřim - OS and heavy vertical lathes (carousels) with the brand of ČKD Blansko - OS (purchased in 2010), is suitably extended through this acquisition by an assortment of heavy horizontal boring and milling machines and heavy lathes from the traditional production of Škoda in Pilsen. This widens even further the range of the offer of technological solutions for companies engaged in heavy machining and production companies in the Alta Group have certainly become much more competitive globally. We talked about the reasons for the acquisition and about further future development with the chairman of the boards of all three entities, ing. Martin Belza, MBA.

1.  Until this above-mentioned acquisition Alta, originally a trading company, owned, inter alia, machine tool manufacturers TOS Kuřim - OS and ČKD Blansko - OS. With this step it has suitably expanded its product technology coverage. What do you particularly consider to be the benefits of this implementation? Which group of customers will you now focus on?

Our target customers are in the field of power engineering, manufacturers of equipment for metallurgy and the shipbuilding industry - overall, heavy engineering. However, we also remain active in the manufacture of transport equipment, mainly railway vehicles, aviation, machinery for construction and agriculture, but we are also trying to break into the production of big moulds and machining of "difficult" materials such as titanium.

2.  Do you feel at this time an increased interest from your customers in the expanded portfolio of heavy horizontal machines and lathes?

The formation of a new group of machine tools manufacturers has not been communicated to our customers yet (one of the conditions during negotiations); this means that we do not have any direct reactions to this step now. However, one of the reasons for the acquisition was the fact that many customers requested Alta in the past for larger machines and this request was solved by both supplies of ŠMT machines, and of other manufacturers.

From the perspective of the past crises, it can be concluded that after the recovery in the production of smaller machines at the end of last year, the real interest of customers even in the assortment of major and large machines is increasing, even in Europe.

3.  Two of the three owners of the company Alta studied at one time in Kiev. How did this fact prove in your gradual activities on the Russian market? Currently, almost all your business is oriented in this direction. Don't you think it is a too one-sided solution in terms of a business strategy?

I have to correct you on this point. The markets of the CIS, primarily Russia, Ukraine and Belarus, are the focus of Alta activities. Manufacturers of machine tools - TOS Kuřim OS, ČKD Blansko OS and now also ŠMT cover the whole world with their activities.

In Alta’s traditional markets our strategy is to apply 1/3 of production of our production companies, 1/3 on the Chinese and Indian markets and the remaining 1/3 on other markets, including the European Union and the Czech Republic.

4. Together with the purchase of Škoda Machine Tool, you will acquire, inter alia, a plant for the modernization of machine tools in Shenyang, China.  Are you going to somehow take advantage of this fact for any potential vigorous expansion into the Chinese market which will undoubtedly also be supported by good local references to Škoda machines?

Yes, this plant is very important to us. Last year TOS Kuřim OS quite interestingly broke into the Chinese market and ČKD Blansko OS had a very good position on this market. However, the Škoda brand is a phenomenon there which we will try to utilize in favour of all three companies.

5.  Development, production and trade of the three previously mentioned entities are spread variously around the Czech Republic - Pilsen, Brno and Blansko. How are you going to deal with this localization fact in the future?

Currently, a new assembly hall is under construction in Kuřim which will allow not only the assembly of heavy portal machines but also the assembly of the entire product line of carousels. After its completion in autumn 2011, we plan to move ČKD Blansko OS to Kuřim. SMT will, of course, stay in Pilsen, and therefore we will coordinate "only" two plants - Pilsen and Kuřim, which should not be a problem.

6.  What are your ideas about the need to centralize research, development and construction of these three companies under one supervisor? Intended with regard to a long term strategy of joint development, as well as for solutions to specific orders.

For the time being construction and development will remain in the individual companies. However, we are assuming a certain centralization of research and development using a prepared project of the Competent Centre Kuřim (CCK). Everything will gradually arise from the implementation of the aforementioned CCK project and the method of setting up mutual communication and coordination.

7.  Can you state the financial details of the realized order and predict how your turnover will increase in the coming years as a result of it?

I cannot be specific in this area. I am bound by the agreement with the selling party. Regarding the expected turnover of the group, we would like to reach CZK 3.5 bln before long.

8.  You produce products of world famous brands - ČKD and now Škoda. How is it in terms of registered marks?

We use Škoda and ČKD Blansko brands on the basis of licences, the TOS Kuřim brand is our property.

9.  How do you see the future of Czech machine tool manufacturers?  Will they withstand global competition? What will they have to do for that?

I am an optimist in this respect. It seems that all major businesses have got over the crisis and it is said that what does not destroy a man, strengthens him... Most of them have gradually built up a satisfactory position in a particular segment. What could backfire is the displeasure towards closer cooperation or property interconnection and often also an inability to communicate with each other - here I see great reserves.