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Send  Share  RSS  Twitter  02 Jun 2010

VENTURES: Cibapac Thrives As It Grows Its Markets


Recent Western Cape Business News

WHEN UK-based Linpac Plastics decided to divest from Linpac Packaging SA many local observers had raised eye-brows, pondering the outcome of the local operation’s future.

Well, the good news is that it’s not only surviving, but prospering thanks to increased marketshare in most segments in which it competes. Importantly, it has become a packaging innovator of note, opening new marketing horizons.

Cibapac is the new, locally-owned re-incarnation of the old Linpac Packaging and by all indications a much more vibrant venture.

Briefly, Montague Gardens-based Cibapac came together in mid-2009 in a R200 million deal, which saw incumbent management (primarily MD Ivan Ortlepp and Financial Director Lloyd White), backed by the financial muscle of Leaf Private Equity and Clearwater Capital take control of Linpac Packaging.

The new company name reflects its focus on food packaging, being derived from ‘cibus’, the Latin for ‘food’.

The deal also ensured that Cibapac is appropriately empowered through Clearwater Capital’s participation.

Cibapac is prominent in the meat, poultry, fish, cheese, ready meals, bakery, pizza, fast food and fresh produce sectors. It is roundly regarded as a leading manufacturer of PVC stretch/cling film, expanded polystyrene (EPS) trays, flexible barrier packaging, multi-layer vacuum bags and seamless casings for polonies.

Managing Director Ivan Ortlepp is upbeat about Cibapac. “After the MBO we were able to bring a local flavour and flexibility to the company. This has allowed us to introduce our own vision and culture. Our shareholders have allowed us a clean slate”.

From a marketing point of view, our independence has enabled us to expand our product range. This has helped our customers and they are now able to procure a variety of their requirements from one source”.

There is still a long way to go, as we have battled to keep up with demand in some product categories. To increase our production capacity we have invested R10 million in new equipment and upgrades. As a world class manufacturing facility, we must ensure that we continuously improve the capabilities of our equipment and people”.

We have invested heavily in staff development and employed consultants to fine-tune our business processes and to improve quality and efficiency of Cibapac”, Ortlepp says.

He points out that as part of a multinational in the past, Cibapac had developed a disciplined and highly-structured approach to management. This was necessary to conform to the stringent reporting policies and has been highly beneficial for the ‘new’ organisation.

This has seen Cibapac maintain some of the non-negotiables like safety and quality and emphasises its vision of being a world class food packaging company, with certifiable production methods. “We are able to ensure that our packaging has traceability and is of food-grade quality”, Ortlepp says.

He emphasises that in a manufacturing and production environment people issues are often the biggest determination of success or failure. “We are committed to open and honest communication amongst our team and there are open channels for everybody to add value”.

We are also not afraid to change and I believe that you either remain at the forefront of change or become its victim; Cibapac has endured significant changes over the last three years and these have been embraced as a challenge and handled with sense”.

Our objectives are always going to be work-in-progress, as we will never be able to rest on our laurels or reaching our targets. Continuous improvement is part of our DNA,” Ortlepp says.

With business running relatively very smoothly, Cibapac needs to invest even more. Its recent exercise to acquire BRC certification (see separate article) cost the company around R2 million. It’s also to invest in the near future additional money to expand its co-extruding capacity.

There is an increasing demand to more lightweight, flexible packaging. This segment has a promising future which we need to exploit it to the fullest”, says Ortlepp.

Cibapac is an enormously big company, with it premises in Montague Gardens covering 40 000 sq m, of which 30 000 sq m are under roof. Here the factory – with equipment ranging from all kinds of mainly extrusion and thermoforming machines – employs around 340 people, working 24/7 year round.

Some 600 tons of polystyrene products are produced each month. More than 5 million Cibatrays – a strong pillar in Cibapac’s product line-up – are produced every day.

Barely a year old this packaging ‘young one’ is up and running at full speed.

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