SICPA Makes Gains in North American Packaging Market

By David Savastano, Ink World Editor | 09.09.05

The company's commercial inks business unit is making strides since its 2000 acquisition of Kromacorp.

When one thinks of the SICPA Group, thoughts of money come to mind. Not the actual money, but the inks that appear on currency, stock certificates and other security documents. It is estimated that SICPA supplies approximately 90 percent of the inks used in security documents and currency.

However, SICPA is also active in other areas. In particular, the company has made strides in its commercial inks business unit. The 2000 addition of Kromacorp International, a Prescott, Ontario packaging ink specialist with worldwide sales of $63 million in 1999 put SICPA squarely into the heart of the packaging ink market in North America.

Today, SICPA North America, formed out of Kromacorp’s U.S. and Canadian operations, is a leading international packaging ink manufacturer. With sales of more than $50 million in 2001, its expectations are also on the rise, with plans for 35 percent growth in 2002.

If the commercial inks business unit continues its quick ascension, SICPA may become known for more than security inks in the coming years.

Peter Mulheran, president and CEO of SICPA North America.
History and Experience
Headquartered in Prilly, Switzerland, SICPA is the world’s fourth-largest ink manufacturer, with annual sales of $650 million. It was founded in 1927 by the Amon family, and it has become the largest privately-owned company that is focused exclusively on printing inks. Its 4,000 employees are spread over 36 countries and six continents.

SICPA is divided into three business units. Commercial inks includes packaging, publication and industrial inks. Product security features brand protection and product security inks. The security business unit includes banknotes and value documents.

Just over one year after its acquisition of Kromacorp International, the SICPA Group consolidated the company’s activities into SICPA North America.

“We waited until now to consolidate Kromacorp’s activities under the SICPA umbrella in order to ensure a smooth integration of our technologies while maintaining the same level of product quality and service that Kromacorp customers have come to expect over the years,” said Peter Mulheran, president and CEO, SICPA North America Inc. “Now, all customers will benefit from the wealth of expertise residing under one organization.”

Kromacorp was an 18-year-old company owned by Hamish Somerville, who remains on as a consultant. The company specialized in gravure and flexo inks, as well as metallic and specialty inks used in the packaging. SICPA North America manufactures water- and solvent-based flexo, gravure and UV/EB inks for flexible and specialty packaging, labels and plastic cards.

Like Kromacorp, Mr. Mulheran is a recent addition to SICPA, having joined the company in early 2001, and he brings his own extensive experience. He is a 25-year veteran of the ink industry, beginning at age 17, when he worked after school for Louis Werneke. After college, Mr. Mulheran returned in 1983 to Werneke and moved to the San Francisco area to start a West Coast operation. With that, Werneke & Mulheran was formed, and Mr. Mulheran served as president until the company was bought out by Akzo Nobel in 1998. Mr. Mulheran became president of Akzo Nobel Ink’s North American operations in mid-2000, before leaving and joining SICPA. SICPA North America’s growth has been quick. A new corporate headquarters has been set up in Brooklyn Park, MN, with existing manufacturing centers located in Oakville, Canada, Prescott, Canada, and Richmond, VA, and Cincinnati, OH. In addition, Cincinnati, OH may also become the home of a new primary manufacturing site in the near future.

There are color blending centers in Brooklyn Park, Cincinnati, Norristown, PA, Vacaville, CA and Montreal, Canada. There are additional Canadian sales operations in Halifax and Calgary, as well as U.S. sales operations in Atlanta, GA and Southern California.

SICPA North America’s operations already have 142 people, including 26 in-plants.

“We’re positioned to service all of North America,” Mr. Mulheran said.

Making Gains in The Packaging Market
SICPA’s growing emphasis on the packaging ink segment is not limited to North America.

‘There is a lot of expansion worldwide,” said Mr. Mulheran. “We just built a brand-new site in Taluca, Mexico and in Belgium. We’ve done a tremendous amount of expansion in Europe and in the Americas. We’re planning on building a new manufacturing facility on a 20-acre site near Cincinnati.”

SICPA utilizes its Ink-in-Kit concept, mixing pigment bases with its technology varnishes to make a multitude of products.

“Ink can make or break any application,” Mr. Mulheran said. “SICPA has developed an excellent portfolio of packaging ink technology, and we’re bringing it over to North America.We already have the whole portfolio of Aarburg technology in Oakville.”

In order to maintain its success, the company has created a powerful R&D presence. In 2001, the company dedicated 3 percent of its budget to R&D; that figure is expected to rise to 4.5 percent in 2003. Presently, the company estimates it has 273 projects ongoing, with 60 percent dedicated to the packaging sector.

Mr. Mulheran believes that the commercial inks segment can benefit from the Smart Ink Technology being developed by the product security unit.

“We have a lot of synergies with our product security business unit,” said Mr. Mulheran. “Some companies are looking for ways to make their packages more tamper-resistant and are seeking more barrier properties.”

One area which SICPA is pursuing is the “smart card” market. The “smart card” market is growing rapidly, growing from one billion cards in 2000 to five billion this year. These are typically produced using sheetfed UV and waterless offset, and it is a market that SICPA is involved in.

The company is also looking to increase its presence in the narrow web and label market while maintaining its strength in special packaging applications such as tobacco.

SICPA North America’s new corporate headquarters are located in Brooklyn Park, MN.

SICPA’s R&D operations rely on networking with raw material suppliers, machinery and substrate manufacturers, key end users and converters while working on ensuring the highest levels of health, safety and environmental compliance. The ultimate goal is zero defects.

“We need to take the lead with our supply chain to ensure a quality end-user product,” Mr. Mulheran said.

SICPA stresses customer service, and Mr. Mulheran said the company’s “cradle to grave” backing of its products and commitment to service on all ends of the business is critical to its customers.

“We can meet the needs of any packaging printer,” Mr. Mulheran said. “Our customers’ expectations are high. They want environmentally-friendly inks that enhance their operations, reduce their costs, and provide value-added. We form partnerships with our customers, beginning with auditing their operations, and identifying areas where improvements can be made. In this way, we can share the savings while delivering a superior product – a concept that we have termed as beyond color.”

As SICPA makes strides in the North American packaging market, its goals remain ambitious. “We grew 24 percent in 2001, and we have a goal of 35 percent in 2002,” Mr. Mulheran said. “We like to think of ourselves as the packaging ink specialists. We emphasize the right product, for the right cost at the right time.”

If SICPA can continue that impressive growth, it should remain a major force in the packaging ink industry in the future.