Friday, October 7, 2016

Managed Print Services Take Center Stage – September 2016 M&A Activity

HP, the spun-off printer and PC division of the technology powerhouse, doubled down on the small-format distributed printing device market, acquiring Samsung’s printer division. The acquisition is HP’s play to stay dominant in the market for office printing devices, squarely in direct competition with Xerox, Canon, Epson and Brother in the $55 billion market for office printing devices. These machines that can quickly print multiple copies in networked office environments are often installed and maintained by outside service organizations known as Managed Print Service (aka “MPS”) companies. Viewed as distinct from the $80+ billion printing industry, these companies compete on a per-page cost basis, maintaining fleets of multi-function printers installed at their customers’ offices. Known as “MFP” devices, the machines scan, copy, fax, email PDF’s, and yes, also print on paper. For large corporate customers, the MPS companies will retain ownership of the machines and provide onsite staffing to operate and maintain corporate in-house print centers, as well deploy MFP’s distributed throughout the customer’s facility.

As we adjust to reading just about everything on digital devices (we suppose millennials are leading the way), shipments of MFP printing devices and supplies have been declining. According to industry research firm International Data Corporation, HP had 36% of the market for printers, but also had the largest decline year-over-year, compared to competitors, an 18.6% decline in the first quarter of 2016. The acquisition of Samsung’s printing business changes the calculus of the decline and will keep HP clearly in the lead if it can execute the integration. With the addition of more than 6,500 technology patents, 1,300 research and development engineers, and thousands of sales, support staff and manufacturing employees, HP gains Samsung’s laser-toner expertise, and of critical importance, cutting-edge inkjet technology. Added to the success of the HP Indigo digital printing devices in the commercial printing and packaging industry, and the PageWide web presses in the direct mail and transactional printing segments, it’s clear that HP is betting that paper-based communications will be good business.

Private equity has taken note of the MPS business. San Francisco-based Oval Partners announced the acquisition of Laser Options in Phoenix, Arizona. Laser Options sells and maintains copiers, printers and document management solutions to corporate customers in the Southwest. This is the second acquisition for Oval Partners in the MPS segment, having acquired FlexPrint as its platform company in the MPS business earlier this year (see The Target Report – January 2016).


Ink is in. A major player in the global ink industry, Luxembourg-based Flint Group, announced the purchase of Printec, a manufacturer of water-based inks for flexo and gravure printers, primarily used to print paper cups and plates, folding cartons and other specialty applications. With backing from Goldman Sachs Merchant Banking Division and Koch Industries, the Flint Group has been an active acquirer of ink manufacturers and other supplies to the printing and related industries. In a somewhat surprising move last year, Flint got into the digital printing equipment business, acquiring press manufacturer Xeikon. Looked at another way, however, the acquisition brings two decades’ development of toner-based technology to the Flint Group, a company that has traditionally sold the blades, not the razors. The technology and foothold in the digital printing segment may position the company as a potential supplier of consumables to the growing digital printing industry. We won’t be surprised if future acquisitions by Flint focus on toner and inkjet supplies.

Avery Dennison, supplier of label and wide format substrates, added to its depth of products in the inkjet printing market with the acquisition of Ink Mill, a manufacturer of solvent-based, water-based and UV-curable inks for digital inkjet printing devices.

Here is a summary of transactions in the ink industry during 2015 and the first nine months

of 2016 (see corresponding Target Reports for more info and links to sources):

M&A Activity in Inks, Pigments & Coatings (2015/2016)
Acquirer Acquired Notes Month
Flint Group Printec Flexo inks Sep-16
Avery Dennison Ink Mill Digital inks Sep-16
Sun Chemical
(Div. Dainippon Ink & Chemicals)
Gravure Ink Business (Europe)
(Div. Flint Group)
Gravure inks Aug-16
Flint Group Druckfarben Offset printing inks Jul-16
(Div. Berkshire Hathaway)
Diamond Dispersions Dyes & pigments Jul-16
Kao Collins Inkjet Inks for inkjet printing Jun-16
Flint Group American Inks and Coatings Packaging inks & coatings May-16
Electronics for Imaging (EFI) Rialco Sublimation dye powders Mar-16
Flint Group Siegwerk Web offset inks Feb-16
Flint Group Advanced Color Systems Water-based inks Feb-16
Sun Chemical
(Div. Dainippon Ink & Chemicals)
Colmar Inks Ink manufacturer Dec-15
(Port co. Altus Capital Partner)
Talon Industries Inkjet inks & supplies Dec-15
Dover JK Group Textile inks Oct-15
JK Group Sawgrass Industrial Sublimation & pigment inks Jul-15
Sun Chemical Sun Chemical SE Europe
(5 countries)
Printing inks & coatings Jun-15
Epson For.Tex Textile inks Jun-15

Commercial Printing - Diversified Services 

September was a notably quiet month overall for M&A activity in the printing and related industries, nowhere more so than in the commercial printing segment. In the related, but more broadly-defined Marketing Solutions Provider (“MSP”) segment, the Hibbert Group, headquartered in Trenton, New Jersey, announced the acquisition of the California-based RedShark Group, a technology content and print management company serving corporate customers with a proprietary cloud-based platform. *

Apex Revenue Technologies, a portfolio company of WestView Capital Partners that manages healthcare billing and collections, acquired LetterLogic. The acquired company, based in Nashville, Tennessee, is a transactional printing and lettershop company focused solely on serving the healthcare industry.

Promotional Products

Printing companies are now often also purveyors of promotional items, especially in the commercial printing segment where traditional job-shop printers seek to transition to more broadly-defined marketing service providers. The business of selling promotional items was once the domain of small, mostly local, companies with independent salespersons that lugged around catalogs displaying printed pens, coffee cups, gadgets, and all sorts of tchotchkes. At least one big player is paying attention. Deluxe Corporation, a dominant printer in the rapidly shrinking business of printing paper checks (you remember checks, that paper device you once used to pay bills). Through its Safeguard division, a business forms printer (you remember forms, that paper device that folks used pens to write on), Deluxe has been building out a promotional items juggernaut, utilizing its network of sales representatives to offer online marketing, design services, promotional products, as well as printed products, to small and medium-sized businesses. Deluxe acquired Arizona promotional items distributor and printing broker B&B Solutions in September, and in August, the company purchased InkHead Promotional Products, an online seller of imprinted promotional products.

It’s not all roses in the promotional products business, however. Entertainment industry promotional products distributor Clean Fun Promotional Marketing filed Chapter 11 bankruptcy in September, in concert with its parent company Delivery Agent, an online company that connected to hundreds of websites that offered products related to entertainment media, including movies, TV, music and sports. According to the president of Clean Fun, the company has a stalking horse buyer lined up and has asked the bankruptcy court for approval to proceed with a sale process.

* Graphic Arts Advisors, publisher of The Target Report, served as advisors to The RedShark Group in this transaction.

2016 September - Mergers and Acquisitions in the Printing, Packaging, Paper & Related Industries  

Deal Party #1
(Surviving Entity)
($Mil )

Party #1 Address

Deal Party #2
($Mil )

Party #2 Address

Deal Structure


Flint Group $2,502 Luxembourg Printec No Data Marietta, GA 9/30/16 No Data Acquisition Flexo inks Link
Apex Revenue Technologies
(Port co. WestView Capital)
No Data St. Paul, MN LetterLogic No Data Nashville, TN 9/20/16 No Data Acquisition Healthcare communications Link
Hibbert Group No Data Trenton, NJ RedShark Group No Data Danville, CA 9/20/16 No Data Acquisition
(Graphic Arts Advisors)
Print management Link
Aleyant No Data Wheaton, IL Tucanna Software No Data Carlsbad, CA 9/20/16 No Data Acquisition Workflow software Link
Access Labels No Data East Amherst, NS PS label division
(Div. Farnell Packaging)
No Data Dartmouth, NS 9/20/16 No Data Acquisition Label printing Link
(Div. Precision Paper)
No Data Tampa, FL Magic
(Div. Coveris)
No Data
Chicago, IL 9/15/16 No Data Acquisition Wide format substrates Link
Avery Dennison $5,950 Glendale, CA Ink Mill No Data Sanbornton, NH 9/13/16 No Data Acquisition Digital inks Link
HP Inc. $99,880 Palo Alto, CA Printer business
(Samsung Electronics)
No Data
South Korea
9/12/16 $1,050 Acquisition Office printers Link
Salt Creek Capital No Data Menlo Park, CA Pacific Paper No Data Rancho Cucamonga, CA 9/8/16 No Data Acquisition Paperboard distribution Link
Deluxe $1,810 Shoreview, MN B&B Solutions No Data Mabelvale, AR 9/8/16 No Data Acquisition Promotional distributors Link
Caraustar Industries No Data Austell, GA Los Angeles Paper Box No Data Commerce, CA 9/6/16 No Data Acquisition Folding cartons Link
Adams Publishing Group No Data Minneapolis, MN Jones Media No Data Greeneville, TN 9/2/16 No Data Acquisition Community newspapers Link
Oval Partners No Data San Francisco, CA Laser Options No Data Phoenix, AZ 9/2/16 No Data Acquisition Managed print services Link

2016 September - Bankruptcy Filings in the Printing, Packaging, Paper & Related Industries

Filing Party

($Mil )

Case #

Filing Party Address


Region & City


Attorney for Debtor

Chapter 11 Filings:
Avatar Packaging 9/20/16 No Data 16-08094 Tampa, FL 11th Middle FL
K. Rodney May Samantha L. Dammer Corrugated boxes
CYU Lithographics Inc 9/16/16 No Data 16-13915 Buena Park, CA 9th Central CA
Santa Ana
Theodor Albert John H. Bauer Commercial printing
Clean Fun Promotional Marketing, Inc. 9/15/16 No Data 16-12053 Costa Mesa, CA 3rd Delaware
Selber Silverstein 
Laura Davis Jones Promotional items
No Chapter 7 Filings Found this Month --- --- --- --- --- --- --- --- ---

2016 September - Non-Bankruptcy Closures in the Printing, Packaging, Paper & Related Industries

Closed Company / Facility

Date of Closure
($Mil )

Closing Address
Related Party Related Party
Date Closure Public


Nebraska Printer 11/3/16 No Data Lincoln, NE None N/A Sep-16 Commercial printing Link