Central European Waste Management Head: Acquisitions Part of Strategy for 2011
In An Exclusive Interview with the C.E. Waste Management President, Dr David Edery, Reporter Samantha Collins Asks the Austrian Recycling Conglomerate's C.O.O. about this New Business Strategy.
By: The Asia Monitor, Vienna Bureau
In 2010, one new trend is called Reverse or Backward Integration. When asked to clarify, Edery explained, “it is a form of vertical integration that involves the purchase of suppliers in order to reduce dependency and exposure to the vagaries of the commodity markets.” A good example, says Edery, “is the tyre manufacturer who acquires rubber plantations or the baker who buys a wheat farm.”
“[With Reverse Integration]
This year has been marked by several large Reverse Integration acquisitions, notably by mining giant Rio Tinto and the Tata Steel empire in their attempts to buy stakes in smaller coal mining concerns. Further, Vale's bauxite mines were bought by Norsk Hydro ASA, and Chinese companies in particular are keen to engage in Reverse Integration to mitigate supply risks.
The strategy also results in reducing excess overhead by leveraging economies of scale, increase efficiency, and producing cost advantages. “These savings are passed directly to our customers,” says Edery claiming that his company's prices will not increase but will be reduced in 2011. “This is the result of a leaner more efficient supply chain.”
Indeed, C.E. Waste Management has been quit busy with mergers and acquisitions in 2010. The company is the result of the merger of Paradigm Industrial Metals with Vulcan Holdings AG and earlier this year acquired the assets of eight smaller recycling plants in Austria, Germany, Italy and the Czech Republic. It also appointed a new Chief Executive Officer to lead the company's expansion, Austrian industrialist Dr. Frederick Von Strasser.
With recycling and waste management plants now located throughout Europe and holdings estimated at some 250 million Euros, Edery believes that Central European Waste Management has expanded both its' supply chain and outreach in 2010 and looks to continue this effort in 2011.
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Central European Waste Management is one of the largest recycling companies in Austria with facilities in Austria, Germany, Italy and the Czech Republic.