According to local media reports, Devold of Norway, a leading outdoor brand and producer of knitted products, is planning to set up a new factory in Lithuania which has already been its main production base since the late 1990s.

Norwegian owned Devold, together with two Lithuanian food co-operatives will become the first investors in the Panevezys industrial park in central Lithuania, news2biz.com reports. The three companies are said to be planning to invest a total of LTL 60 million (US$ 22 million)plus and create 470 jobs on three land plots totalling 11.5 hectares, one fourth of the park's total business area.

Devold's project is apparently the largest and with a reported investment budget of LTL 34 million (US$12 million), the knitted goods producer intends to construct a new plant on a 6.5-hectare plot to which it will relocate 260 existing jobs and create a further 100 jobs during the next three years.

"The prospects of the industrial zone becoming an FEZ with clear CIT breaks is the main reason why Devold has resolved to invest in Panevezys," Devold's Tor Jonsson told news2biz.

"Otherwise, we would have opted to relocate the Lithuanian activity to an FEZ in a neighbouring country," he said.

According to the report, Devold's agreement with the municipality still allows the company to terminate it should the FEZ establishment plan not materialise. As things stand now, the company plans to build a 12,000-15,000 square metre plant.

"The exact size is not yet decided. The new plant will definitely raise our cost efficiency because today we are working on four different rented locations totalling around 6,000 sq.m in Panevezys and nearby Kupiskis. This is not efficient," Jonsson said.

As well as the consolidation of production, the new plant could also serve as a logistics hub for the mother company Devold of Norway's European sales, the reports said.

"Devold in Lithuania is now the Norwegian company's production base. From here we ship products to Norway from where it reaches retail trade channels. Most of the output is sold locally but we want to expand sales in Europe. Then it would make sense to use the new facilities in Panevezys for direct distribution to European markets. In fact, the lack of bigger production capacities and a logistics facility has prevented the Norwegian company from making deeper inroads into new markets," Jonsson explained.

Devold plans to have the new plant built by the end of 2013 or beginning of 2014. Devold of Norway AS is an independent company with a long and proud history which has produced high-quality wool clothing since 1853, making it the oldest manufacturer of knitted garments in Norway.

The company's aim is the same today as when Ole Andreas Devold founded the company 155 years ago: to create comfortable, high-quality clothing that protects people against the elements.  

Devold of Norway serves two different markets, offering sports and leisure wear and protective clothing. Its goal is to maintain its renowned product quality, which is the result of a long tradition of craftsmanship combined with the best available technology, while continuing to develop new functional garments of appealing design.

Devold sports and leisure wear comprises a wide range of comfortable wool underwear, socks, headwear, various types of mid-layer garments and knitted sweaters.

Within protective clothing it makes underwear, mid-layer garments, socks and accessories. All designed to protect users against cold, heat and flames.

Source: news2biz.com