Salzgitter subsidiary KHS gets “Fit4Future”

Dortmund, September 16, 2011 – In yesterday’s Supervisory Board meeting of KHS the key milestones and measures for the development of the international manufacturer of filling and packaging machinery through to 2014 were presented and approved. KHS is a wholly-owned company of the Salzgitter Group.

Prof. Dr.-Ing. Matthias Niemeyer, Chief Executive Officer of KHS GmbH, stated that "in presenting the ‘Fit4Future’ initiative the new management team is consistently implementing the course already charted in the direction of operational excellence, buoyed by a shared sense of a fresh start. Top priority has been placed here on intensifying customer proximity and sharpening our competitive edge. The intention is to improve across the board. Our aim is to achieve leadership in technology and service, combined with profitable growth. The great trust vested by Salzgitter AG, our parent company, gives us sound backing for the ongoing development of our company and our products."

Today the KHS Group is one of the world's three full-line providers of holistic system solutions in the beverages, food and non-food industries and a competent supplier of custom-made machinery for a wide variety of applications, especially for smaller companies. The cornerstone of this achievement was laid through the business combination of Holstein & Kappert and Seitz-Enzinger-Noll AG in 1993 and acquisitions made in recent years.

Reinforcing the company's market position as an innovator

To reinforce its already strong market position, KHS has set its sights on the growth markets of the BRIC countries (Brazil, Russia, India, China). With its global production and service network, KHS has a significant advantage over its competitors.

KHS will put its international production network to the best possible use and, to this end, has introduced measures to ensure regional market coverage with a harmonized international product portfolio. Moreover, process optimization is intended to accelerate the service processes across the globe. KHS views itself as a pioneer for large and small beverage bottlers in these dynamic markets.

The company is also focusing increasingly on innovation. Innosept ABF 611 and 711, aseptic linear filling machinery, the compact Innokeg Till CombiKeg line, the new Hygienic Design Innofill glass filler and the fully closed shrink packs are some of the most important product innovations to be launched in the market by KHS in 2011. There are more innovations in the pipeline which cater especially to the demand in the aforementioned growth markets and which serve to optimize the product portfolio.

Faster and more efficient

In order to operate faster and more efficiently, KHS will also be working more closely together in geographical terms. Having combined production facilities in recent years, KHS will now be relocating its kegging technology, taken over from Kriftel in 1999, to Bad Kreuznach, its second largest site. Along with its optimal infrastructure, the new location will also enable the company to respond better to demand peaks. Moreover, the internationally very successful kegging business line will have room for future growth.

The path taken towards sustainable competitiveness also entails personnel-related measures. This is part of the extensive 11-component Fit4Future program. There will be a reduction of 300 jobs, mainly in overheads. This measure will be implemented in an as acceptable and balanced a manner possible in full accord with the parent company Salzgitter AG. KHS management has already met with the Works Council in order to discuss further procedures.

About KHS GmbH KHS is a system provider of technologically innovative, premium filling and packaging machinery and equipment for the beverage and food industries. The Group, which is managed centrally from Dortmund and has over 5,500 employees worldwide, today realizes sales totaling nearly one billion euros. Along with production sites in the US, Mexico, Brazil, India and China, KHS operates a number of plants in Germany. More information www.khs.com

KHS GmbH is wholly owned by Klöckner-Werke AG which, in turn, belongs to Salzgitter AG, one of Europe's leading steel and technology groups. KHS GmbH is the core company of the Salzgitter Group’s Technology Division. The squeeze-out at Klöckner-Werke AG was completed on January 27, 2011, thus making KHS GmbH an indirect wholly-owned subsidiary of Salzgitter AG. More information www.salzgitter-ag.com