Avery Dennison: ‘We believe in a future where every physical item will have a unique digital identity’

05-Dec-2019 - Last updated on 05-Dec-2019 at 13:04 GMT

Avery Dennison Corporation to acquire Smartrac’s Transponder (RFID Inlay) Division. Avery Dennison

Avery Dennison Corporation is to acquire Smartrac’s Transponder (RFID Inlay) Division, for €225m, closing in the next few months.

Smartrac's RFID inlay and tags business will complement Avery Dennison’s Intelligent Labels platform, expand its existing product portfolio, enhance the company’s R&D, manufacturing and sales capacity and increase its RFID offerings.

RFID growth opportunities

The transaction will also provide the opportunity to expand market coverage and to accelerate RFID growth opportunities.

Mitch Butier, president/CEO, Avery Dennison, said the acquisition reflects a continuation of its strategy to invest, both organically and through M&A, to shift its portfolio towards faster growing, higher value categories.

“Smartrac’s Transponder Division represents an excellent strategic fit for us, accelerating our strategy to expand our Intelligent Labels platform across a variety of end markets and customers within the industrial and retail segments, and extending our reach to new channels," he said.

The division develops and manufactures RFID products, with 2019 estimated global revenue of approximately €125m (approx. $140m) and about 900 employees.

Avery Dennison will acquire Smartrac’s Transponder business and associated assets, including all manufacturing, R&D, sales and administration facilities, and will take over all affected employees.

“We believe in a future where every physical item will have a unique digital identity and digital life, which will transform the visibility of products throughout the supply chain, all the way to the consumer, helping to improve efficiencies, increase sustainability, and enhance consumer experience,” said Francisco Melo, VP/GM, intelligent labels, Avery Dennison.

“The capabilities of Smartrac will enable us to continue delivering on this vision across multiple verticals.”

A pioneer in the industry

Christian Uhl, CEO, Smartrac said its RFID transponder business is among the pioneers in the RFID industry, having built an attractive product portfolio across a variety of customer needs and frequencies.

“What we are announcing today is a big change in Smartrac's history. Our people and capabilities are complementary to Avery Dennison, offering a perfect basis to expand market success,” added Uhl.

“We are convinced our RFID inlays and tags business will face a bright future as part of Avery Dennison’s Intelligent Labels business, which is set to thrive on the rise of the Internet of Things and the growing customer demand for connected products.

“At the same time, our successful Solutions Business Division will continue to independently build on its offerings supporting the digital transformation.”

Smartrac is headquartered in Amsterdam, the Netherlands. The company has manufacturing facilities in Germany, Malaysia, China, and the United States.

Headquartered in Glendale, California, Avery Dennison is a global materials science and manufacturing company specializing in the design and manufacture of labeling and functional materials.

Its products include pressure-sensitive materials for labels and graphic applications; tapes and other bonding solutions for industrial, medical and retail applications; tags, labels and embellishments for apparel; and RFID technology serving retail apparel and other markets.