63
EQUIPMENT
january-february 2014
international
construction
Metso
New focus
Crushing and
screening equipment
manufacturer Metso
has demerged its pulp
& paper business.
CEO
Matti Kähkönen
says this should mean
a more focussed
company, writes
Sandy Guthrie
.
A
fter nearly a full year of
planning, Metso has split
in two, in a demerger
that has seen the automation,
mining and construction elements
separated from the pulp, paper
and power businesses, which
is now called Valmet.
Metso’s CEO, Matti
Kähkönen said, “The split
started in the early part
of 2013, when we started
thinking about the
bit of downturn,” Mr Kähkönen
said he believed the global mega-
trend, as well as environmental
and many other issues, would
drive demand for the company’s
products long-term.
“Because infrastructure building
will take place for years to come,
we see good potential in all of
those businesses to go forward. It
was a fairly natural split in a way,”
he said.
Looking at new Metso, Mr
Kähkönen said, “Construction
is an important part, though of
course mining is a little more than
half our revenues. Construction is
about 30% – but construction and
mining are related very strongly to
each other in terms of technology.”
Global presence
“We are everywhere in the world
when it comes to mining and
construction. For construction,
Europe and North America have
been, and still are, the main
markets – if I remember correctly,
70 to 80% of our construction
volume. Europe is a little bigger
than North America,” said Mr
Kähkönen.
However, he admitted Metso had
not been a big player everywhere
in the world, China being one
example.
“We are strong in the upper end
of the market, but last year we
made an acquisition, a company
called Shaorui, which is only for
the mid-market construction
business in China.”
Metso has also established a
partnership with Liugong to
produce mobile crushers for the
Chinese market.
“This mobile market is very
developed in Europe and North
America,” said Mr Kähkönen.
“It’s not developed very much in
China, but it is getting to the point
where the mobile crusher market
is beginning to develop in
China as well. It is for that
reason we established the
relationship [joint
venture] with Liugong.”
Elsewhere in the world, Metso
enjoys a strong position in India,
having had its own factories there
since the 1990s. “If you have
to pick up the one thing that
is important to us, it’s service,
service, service.
“To do that well, you need to be
close to your customers. In the
case of Indian construction, you
cannot be successful delivering
something from Europe or
somewhere else.
“In construction, you need to
be local because a big part of
our business comes from local
contractors, so it might be within
one country or one region. This
sales and service network is
important from a construction
point of view,” said Mr Kähkönen.
“It goes for Europe, as well,” he
added. “We have a strong footfall
traditionally in Europe, so we
have main manufacturing units in
Finland and in France. From those
two locations we have served the
whole of Europe.”
He said the factories in Finland
and France were sufficient. “We
can serve the European need and
also some other areas. We are in
China, have a strong foothold
in India and manufacture in
Brazil – our site close to Sao Paulo
is Metso’s biggest. It’s for the
Brazilian mining industry but also
for construction.”
Focus
So now there is a new Metso. “The
whole organisation should get
more focused,” said Mr Kähkönen.
“It will lead to better services
and products for our customers,
and also mean that we are
reacting more quickly when there
is something happening in the
marketplace, so that the flow of
information will be fast within the
company.
“This will be how we can truly
help our customers do better
business, improve their processes
and increase their productivity.”
iC
Metso’s future direction, and how
to develop Metso to make sure it
grows and is profitable. We came
to the conclusion that it was an
obvious, natural point in time, and
that the company would be better
off going ahead as two different
companies.”
He added, “The purpose of this
demerger is how to accelerate the
growth and the development of
both companies by having more
focused management, starting with
the board of directors. Now there
will be two boards of directors, and
they can focus on their respective
industries.
“It will mean that we will go
deeper into construction,
mining and
automation, and
to look at the
opportunities
within those
customer
industries even
more actively.”
Despite some
tough years in the
industry - “a little
Metso CEO Matti
Kähkönen.
