Wednesday, June 7, 2017

Small Printers are Big Business – May 2017 M&A Activity


MBE Worldwide, owner of the international franchise system, Mail Boxes Etc., moved back into the United States with its strategic and decisive acquisition of PostNet. With over 300 stores in the US and another 400 distributed throughout Central and South America, Australia and South Africa, the PostNet franchise system brings the MBE network to almost 2,300 locations in more than 33 countries.


PostNet is a US-centric storefront-based system of franchised printing, marketing and shipping stores focused on serving small businesses. The acquisition pits MBE Worldwide into direct competition in the US with the UPS Store locations which were rebranded with the UPS moniker in the US and Canada when UPS acquired Mail Boxes Etc. in 2001. UPS subsequently jettisoned the Mail Boxes Etc. stores outside the US and Canada in 2009, selling the global system to the Fineffe Group based in Milan, Italy. Owned by the Fiorelli family, Fineffe also owns other retail franchise systems under the Western Union, Direfarestampare (printing centers) and Credit Planet brands.

The business of “micro” print shops is now dominated by franchise systems all competing on a crowded playing field. In addition to the UPS Store, the design-print-ship business model is crowded with other storefront systems: FedEx Office, Alphagraphics, Fastsigns, Allegra and the Minuteman Press systems. For the Fineffe Group, all those independently-owned and operated franchisees add up to a significant global business bolstered and able to compete in the US market with the addition of the PostNet brand. Total combined system-wide revenue for Fineffe’s print stores equals $580 million, based on 2016 results.

While we are on the topic of small franchised printing companies, it’s worth noting that some franchise owners build a sizeable business by acquiring other small companies or aggregating a portfolio of separate stores, usually within a region. The owners of the Minuteman Press franchise in Levittown, New York purchased an independent commercial printer, Fullstop Printing, and tucked that business into its Minuteman Press franchise. In another May transaction, the owner of the Minuteman Press franchise in Parker, Colorado purchased an independent printing company in Castle Rock, Colorado, converted the company to a Minuteman Press franchise, and is planning to keep both locations open.

Commercial Printing and Diversified Services

Consolidation has picked up steam in the commercial printing segment. The Standard Group in Reading, Pennsylvania announced the acquisition of Epic Litho, the rebranded identity of the former Bentley Graphics and Rowland Printing which joined forces in 2010. Standard has built its business at least partially through a series of acquisitions, beginning in 1996, with the latest being the most impactful due to the very high-quality work produced at Epic, according to the CEO.


Mossberg & Co., a commercial printer in South Bend, Indiana announced the acquisition of Foster Printing in Michigan City, Indiana. Auction notices went out shortly after the announcement for the equipment at Foster Printing as that location will be shuttered after 94 years, moving production to Mossberg’s two facilities in South Bend. On a personal note, having printed many beautiful projects for IBM in the 1980’s that made playful use of graphic designer Paul Rand’s famous logo design for the company, I must express my appreciation for Mossberg’s logo, designed by the master himself in 1991.

The two largest commercial printing companies in Edmonton, Alberta decided to join forces; The Burke Group taking the lead and acquiring cross-town rival McCallum Printing Group. Print management and marketing services company Winbrook, in Billerica, Massachusetts, acquired RPM, a Hingham, Massachusetts-based company focused solely on providing New England banks and credit unions with printing, marketing and inventory control programs. Talient Action Group in Manchester, New Hampshire acquired the business of Proofing House Press in nearby Salem, New Hampshire.*

Moving Upstream from Print

As noted recently in The Target Report, private equity investment firms have recently shown increased interest in the commercial printing segment after several years of either no interest or quiet exits from failed attempts to establish a robust platform (private equity having never lost interest in the packaging segments). An example of the renewed, and you could say robust, activity in the commercial printing segment is PE firm ICV partners, which recently acquired a commercial printing company, FuseCreates, to add to the Colorado location of OneTouchPoint (Revenues = $150 million) (see The Target Report – January 2017). ICV completed this deal right on the heels of its acquisition of the much larger direct marketing printing company SG360° (Revenues = $300 million) (see The Target Report – December 2016). Before that, in November 2016, the fund bolted a smaller commercial printing company, PrintManagement, onto OneTouchPoint. On May 9th, ICV was back in the market and announced the acquisition of LeadingResponse, a client acquisition and lead generation specialist firm serving professional practices. A major buyer of direct mail printing, the acquired company is data-focused with revenues of approximately $70 million.

On a smaller scale, but still indicative of the trend to bolt marketing services onto print-centric companies, Didit, located on Long Island, New York acquired New York City-based The Halo Group, a provider of marketing and branding services. 


* Graphic Arts Advisors, publisher of The Target Report, served as exclusive advisors to Proofing House Press in this transaction.


2017 May - Mergers and Acquisitions in the Printing, Packaging, Paper & Related Industries  

Deal Party #1
(Surviving Entity)
Pre-Deal
Revenues
($Mil )


Party #1 Address


Deal Party #2
Pre-Deal
Revenues
($Mil )


Party #2 Address
Date
Deal
Public
Deal
Value
($Mil)

Deal Structure
(Intermediary)


Notes

Press
Release
The Burke Group No Data Edmonton, AB McCallum Printing Group No Data Edmonton, AB 5/30/17 No Data Acquisition Commercial printing Link
Standard Group No Data Reading, PA Epic Litho No Data Phoenixville, PA 5/30/17 No Data Acquisition Commercial printing Link
Mossberg & Co. $22.7 South Bend, IN Foster Printing No Data Michigan City, IN 5/17/17 No Data Acquisition Commercial printing Link
Minuteman Press
(Franchisee)
No Data Levittown, NY Fullstop Printing No Data Levittown, NY 5/17/17 No Data Acquisition Printing & copying Link
Coloredge No Data New York, NY Color By Number No Data New York, NY 5/17/17 No Data Acquisition Package prototyping & design Link
Pfingsten Partners No Data Chicago, IL Sign-Zone No Data Brooklyn Center, MN 5/16/17 No Data Acquisition Sign & display products Link
Altor Funds No Data Copenhagen,
Denmark
TRESU Group
(Port co. Erhvervsinvest)
No Data Bjert, Denmark 5/15/17 No Data Acquisition Flexo printing presses Link
Minuteman Press
(Franchisee)
No Data Parker, CO Minuteman Press
(Franchisee)
No Data Castle Rock, CO 5/15/17 No Data Acquisition Printing & copying Link
Tronc No Data Chicago, IL Wrapports Holdings
(Parent Chicago Sun-Times)
No Data Chicago, IL 5/15/17 No Data Acquisition Metro newspaper Link
MBE Worldwide $508.5 Milan, Italy PostNet No Data Lakewood, CO 5/15/17 No Data Acquisition Mail & copy franchise system Link
Didit No Data Mineola, NY The Halo Group No Data New York, NY 5/10/17 No Data Acquisition Marketing & branding agency Link
ICV Partners No Data New York, NY Leading Response
(Port co. Huron Capital Partners)
$70.0 Tampa, FL 5/9/17 No Data Acquisition Direct mail & marketing Link
Electronics for Imaging (EFI) $986.6 Foster City, CA CRC Information Systems
(Div. Reynolds and Reynolds)
No Data Scottsdale, AZ 5/8/17 No Data Acquisition MIS system for printing Link
Goss International
(Port co. American Ind. Partners)
No Data Durham, NH Loudon Machine No Data Effingham, IL 5/8/17 No Data Acquisition Printing equipment services Link
Winbrook No Data Billerica, MA RPM No Data Hingham, MA 5/1/17 No Data Acquisition Print management Link
Talient Action Group No Data Manchester, NH Proofing House Press No Data Salem, NH 5/1/17 No Data Acquisition
(Graphic Arts Advisors)
Commercial printing Link


2017 May - Bankruptcy Filings in the Printing, Packaging, Paper & Related Industries



Filing Party

Date
Case
Filed
Pre-Petition
Revenues
($Mil )



Case #



Filing Party Address



Circuit



Region & City



Judge



Attorney for Debtor



Notes
Chapter 11 Filings:
No Chapter 11 Filings Found this Month --- --- --- --- --- --- --- --- ---
Chapter 7 Filings:
CAD & Graphic Supply, Inc. 5/3/17 No Data 17-41910 Gallatin, TN  5TH Northern TX
Dallas
Mark X. Mullin  Stephen M. Stasio Wide format machines & supplies


2017 May - Non-Bankruptcy Closures in the Printing, Packaging, Paper & Related Industries



Closed Company / Facility

Date of Closure
Pre-Closure
Revenues
($Mil )



Closing Address
Related Party Related Party
Address
Date Closure Public


Notes

Press
Releases
General Loose Leaf 6/15/17 No Data Waukegan, IL None N/A 5/30/17 Loose leaf binder manufacturing Link
The Roanoke Times - Printing plant Aug-17 No Data Roanoke, VA BH Media Group Omaha, NE 5/30/17 Outsourcing print production Link
LSC Communications - Printing plant Jul-17 No Data Salem, VA LSC Communications Chicago, IL 5/22/17 Book manufacturing Link
Foster Printing 6/21/17 No Data Michigan City, IN Mossberg & Co. South Bend, IN 5/17/17 Sale of company & plant consolidation  Link
JB Printing  7/13/17 No Data Newmarket, ON None N/A May-17 Commercial printing Link
Newburgh Envelope 6/20/17 No Data Newburgh, NY None N/A May-17 Envelope printing Link



Sunday, May 7, 2017

Legacy Printing Companies Fade Into History – April 2017 M&A Activity

The Printer's Devil - Signage in York, UK
Dartmouth; the name brings forth an association with history, tradition, quality, intelligence, excellence, and competitiveness. In the case of Dartmouth Printing, the association is more than a commercial operation borrowing the name to impart those qualities to its brand; the printing company was originally established as Dartmouth Press in 1793 as the in-plant printing operation for the college that bears the same name. Fifty years later, in 1843, Dartmouth College spun off the printing operation as an independent printing company. 
Daniel Webster

According to company legend, the printing company employed several famous alumni of the college, including Nelson Rockefeller who worked as a typesetter while attending Dartmouth and later became governor of New York and a US Vice President. Many years before, Daniel Webster, the famous attorney, politician and orator, reportedly worked as a “printer’s devil” at the printing company before he graduated from Dartmouth in 1801. Webster eventually served in the House of Representatives, in the Senate, and as US Secretary of State. Webster not only negotiated the final settled line between the US and Canada, but also famously (and fictionally) defended a New Hampshire farmer who had sold his soul to the devil.


Dartmouth Printing is now part of the CJK Group, which recently acquired The Sheridan Group, and which itself had acquired Dartmouth Printing in 1998. The CJK Group has grown through acquisitions from its roots as Bang Printing in Brainerd, Minnesota, and began its roll-up acquisition strategy in 2013 with the asset purchase of Hess Printing in a bankruptcy 363 sale (see The Target Report – May 2013). Bang subsequently acquired book printers Victor Graphics in Baltimore, Maryland and most recently Sentinel Printing in St. Cloud, Minnesota. Bang also has a Los Angeles location, marketed as Sinclair Printing. The common thread running through each of the CJK Group acquisitions is that each company is strongly anchored in book printing, along with expertise in publications and catalogs, and this latest acquisition is right in line with that strategy.
Beginning with its relationship with the college and including its inclusion with CJK‘s acquisition of Sheridan, the former college print shop is now with its ninth owner. It has been reported that the Dartmouth name is being retired and that the New Hampshire location will be flying the Sheridan brand name flag and no longer carry the name of the venerable college with the ivy league heritage.

No far from Sheridan’s home base in southeast Pennsylvania, another legacy company in the printing industry, Intelligencer Printing, has been acquired by newly-formed Intellicor Communications, a roll-up that also includes Pemcor Printing, also located in Pennsylvania and AE Litho, a South-Jersey commercial printing and fulfillment operation. Intelligencer Printing is one year younger than Dartmouth Printing, having been established in 1794 as the printing operation for the Lancaster Journal and until this sale has been owned by successor companies to the original newspaper publisher. It’s not clear yet if the historical name will live on as a division of Intellicor or be retired to the dustbin of printing company names, this one having survived longer than most.

Equipment Manufacturing


While not as numerous as the M&A activity occurring in the operational printing and packaging industries, a steady drumbeat of transactions have been completed in the realm of equipment manufacturing - the folks that make the machines that enable the efficient printing of ink on substrates and related ancillary functions.

The M&R Companies specialize in manufacturing screen printing and related equipment, much of which is used for printing textiles as large format graphics. Owned since 2015 by the Corinthian Capital Group, M&R acquired Novus Imaging, a New Hampshire-based manufacturer of digital inkjet UV printers. It’s a strategically savvy combination since digital printing devices continue to make inroads into applications formerly served exclusively by screen printing.

Winkler+ Dünnebier, acquired by Barry-Wehmiller in 2015, broadened its reach in the envelope manufacturing business with the acquisition of envelope printing press manufacturer Halm Industries, maker of the ubiquitous Halm Jet Press. Barry-Wehmiller has grown via acquisitions to revenues in excess of $2.5 billion, this latest deal being its 89th, many with a clear focus on companies that process, slit, sheet, corrugate, print and package paper.


Here is a summary of transactions involving equipment manufacturers in the printing and packaging industries in 2016 and the first four months of 2017 (see the corresponding Target Reports for more info and links to sources):

M&A Activity - Printing & Packaging Equipment Manufacturers (2016/2017)
Acquirer Acquired Notes Month
M&R
(Port co. Corinthian Capital)
Novus Imaging Flatbed inkjet printers Apr-17
Winkler + Dünnebier
(Div Barry Wehmiller)
Halm Industries Envelope printing presses Apr-17
Goss International
(Port co. American Ind. Partners)
Graphic Automation Controls Press upgrades, maintenance Mar-17
Danaher Advanced Vision Technology Print inspection systems Mar-17
Baldwin Technology
(Port Co. Forsyth Capital)
Air Motion Systems LED UV curing systems Jan-17
Bell and Howell
(Port Co. Versa Capital Mngt.)
Sensible Technologies Mailing services equipment Jan-17
Global Graphics Meteor Limited
(Div. TTP Group)
Printhead driver systems Dec-16
HP Inc. Printer business
(Samsung Electronics)
Office printers Sep-16
Double E
(Port co. Incline Equity Partners)
Appleton Mfg. Division Web accessories Aug-16
Cefla Finishing JetSet Industrial Specialty inkjet equipment Aug-16
Xaar Engineered Printing Solutions Pad printing equipment Jul-16
Epson Robustelli Digital inkjet textile printers Jun-16
Koenig & Bauer (KBA) Iberica
(Div. Cerutti Group)
Diecutting equipment mfg. May-16
Apex Technology Lexmark International Printing devices Apr-16
Novus Imaging Redwood Technologies Inkjet technology design Apr-16
Xerox Document Technology Digital printing equipment Jan-16
Mimaki La Meccanica Costruzione Tessili Textile printing machines Jan-16
Ricoh AnaJet Direct to garment printing Jan-16

Packaging

Resilience Capital Partners teamed up with The Kennedy Group to form Lux Global Label Company, which then acquired National Label, a Pennsylvania-based company with additional production facilities in Puerto Rico and Singapore. According to the press release issued by SSG Capital, the investment banking firm that ran the sale process, National Label had completed a significant capital investment program and was poised to compete in the consolidating global packaging segment, but had developed resultant cash flow constraints that led to the decision to seek buyers for the company. The investment in Lux Global Label is Resilience Capital’s second recent foray into print-related industries, the private equity fund having acquired printing and document management company DG3 in August 2016 (see The Hyde Opinion – Sept 2016). The Kennedy Group is, like Resilience, located in the Cleveland area. Kennedy is a manufacturer of labels, flexible packaging and RFID tracking systems, and has two additional locations, both in Florida.

Pritzker Group Private Capital continued to build out its ProAmpac platform with the acquisition of Trinity Packaging Corporation. Trinity is a New York-based producer of large format flexible packaging used for lawn and garden products, pet food, and other bulk products. Trinity has operations in New York and Virginia. This acquisition brings the total number of manufacturing plants under the ProAmpac umbrella to 22 sites. The ProAmpac packaging roll-up was created by Wellspring Capital which then sold to the Pritzker fund in a secondary buyout (see Moving Pieces Around the PE Chessboard).

The Resource Label Group, a portfolio company of First Atlantic Capital, announced the acquisition of Gintzler International, a label printing company located in Buffalo, New York, with a second location in Texas. The acquisition is the company’s tenth under First Atlantic’s ownership which brings the total to thirteen manufacturing facilities in the United States and Canada. In addition to the Resource Label Group platform, First Atlantic Capital also is invested in the flexible packaging segment. In 2014, First Atlantic folded MRI Flexible Packaging into C-P Flexible Packaging, which it acquired the year before.


2017 April - Mergers and Acquisitions in the Printing, Packaging, Paper & Related Industries

Deal Party #1
(Surviving Entity)
Pre-Deal
Revenues
($Mil )


Party #1 Address


Deal Party #2
Pre-Deal
Revenues
($Mil )


Party #2 Address
Date
Deal
Public
Deal
Value
($Mil)

Deal Structure
(Intermediary)


Notes

Press
Release
Lux Global Label Company
(Port co. Resilience Capital Partners)
No Data Lafayette Hill, PA National Label No Data Lafayette Hill, PA 4/28/17 No Data Asset Acquisition
(SSG Capital Advisors)
Label printing Link
Static Control No Data Sanford, NC Ink Technology Corporation No Data Cleveland, OH 4/26/17 No Data Asset Acquisition Impact & inkjet inks Link
Vision $72.5 Chicago, IL The Core Organization No Data Elmhurst, IL 4/25/17 No Data Acquisition Direct response agency Link
NPES No Data Reston, VA Graphic Arts Show Company
(JV w/ PIA and Ideallliance)
No Data Reston, VA 4/20/17 No Data Buyout of Minority Printing trade shows Link
M&R Companies
(Port co. Corinthian Capital)
No Data Roselle, IL Novus Imaging No Data Moultonborough, NH 4/18/17 No Data Acquisition Flatbed inkjet printers Link
Saltwire Network No Data Halifax, NS Eastern Canada Newspapers
(Prop. Transcontinental)
No Data
($2,020)
Montreal, QC 4/13/17 No Data Acquisition 27 Community newspapers
(inc. 4 printing plants)
Link
Hubergroup USA
(Div. Hubergroup)
No Data
($885.0)
Kankakee, IL
(Kirchheim, Germany)
Alden & Ott Printing Inks No Data Arlington Heights, IL 4/10/17 No Data Acquisition Printing inks Link
ProAmpac
(Port co. Pritzker Group)
No Data Cincinnati, OH Trinity Packaging No Data Armonk, NY 4/10/17 No Data Acquisition Bags & flexible packaging Link
Harland Clarke Holdings
(Port co. MacAndrews & Forbes)
No Data San Antonio, TX RetailMeNot $295.4 Austin, TX 4/10/17 $630.0 Acquisition Online consumer coupons Link
Image Printing No Data Bismarck, ND Knight Printing No Data Fargo, ND 4/7/17 No Data Acquisition
(Crescenda Advisors)
Commercial printing Link
Hoffmaster No Data Oshkosh, WI Sumner Printing No Data Somersworth, NH 4/6/17 No Data Acquisition Hospitality products Link
Resource Label Group
(Port co. First Atlantic Capital)
No Data Franklin, TN Gintzler International No Data Buffalo, NY 4/7/17 No Data Acquisition Label printing Link
Dover Corp $6,956 Downers Grove, IL Caldera Graphics $11.6 Eckbolsheim, France 4/5/17 $37.0 Acquisition RIP & workflow software Link
Intellicor No Data Lancaster, PA Intelligencer Printing $26.6 Lancaster, PA 4/5/17 No Data Acquisition Direct mail printing Link
Intellicor No Data Lancaster, PA AE Litho No Data Beverly, NJ 4/5/17 No Data Acquisition Forms & commercial printing Link
Intellicor No Data Lancaster, PA Pemcor Printing No Data Landisville, PA 4/5/17 No Data Acquisition Commercial printing Link
Winkler + Dünnebier
(Div Barry Wehmiller)
No Data Neuwied, Germany Halm Industries No Data Glen Head, NY 4/4/17 No Data Acquisition Envelope printing presses Link
Avery
(Div. CCL Industries)
$579.6
($2,898)
Toronto, ON Goed Gemerkt No Data Utrecht, Netherlands 4/3/17 $34.4
(Combined)
Acquisition Personalized labels
(Combined $16.1Mil revenue)
Link
Avery
(Div. CCL Industries)
$579.6
($2,898)
Toronto, ON Badgepoint No Data Ahrensburg, Germany 4/3/17 $34.4
(Combined)
Acquisition Name badges
(Combined $16.1Mil revenue)
Link
CJK Group No Data Brainerd, MN The Sheridan Group
(Port co. Jefferies Capital Partners)
$196.5 Hunt Valley, MD 4/3/17 No Data Acquisition Publication & book printing Link


2017 April - Bankruptcy Filings in the Printing, Packaging, Paper & Related Industries



Filing Party

Date
Case
Filed
Pre-Petition
Revenues
($Mil )



Case #



Filing Party Address



Circuit



Region & City



Judge



Attorney for Debtor



Notes
Chapter 11 Filings:
No Chapter 11 Filings Found this Month --- --- --- --- --- --- --- --- ---
Chapter 7 Filings:
AMS Press, Inc. 4/13/17 No Data 17-50406 Norwalk, CT 2nd Connecticut
New Haven
Julie A. Manning Suzanne B. Sutton Publisher of academic journals


2017 April - Non-Bankruptcy Closures in the Printing, Packaging, Paper & Related Industries



Closed Company / Facility

Date of Closure
Pre-Closure
Revenues
($Mil )



Closing Address
Related Party Related Party
Address
Date Closure Public


Notes

Press
Releases
JB Print Solutions 4/26/17 No Data Toronto, ON None N/A 4/26/17 Commercial printing Link
Checkerboard Limited 5/10/17 No Data West Boylston, MA None N/A Apr-17 Stationery printing Link
Custom Printing & Copy May-17 No Data East Hartford, CT None N/A Apr-17 Printing & copying Link
H&R Bindery 4/26/17 No Data Menomonee Falls, WI None N/A Apr-17 Trade bindery Link
Custom Bookbinders 5/18/17 No Data Austin, TX None N/A Apr-17 Specialty bookbinding Link
The Garvey Group
(Div. Orora Group)
Jun-17 No Data Franklin, WI Orora Group Hawthorn, Australia 4/3/17 Consolidating post-acquisition
(Formerly Troyk Printing)
Link
The Garvey Group
(Div. Orora Group)
Jun-17 No Data Sturtevant, WI Orora Group Hawthorn, Australia 4/3/17 Consolidating post-acquisition
Commercial printing, retail display
Link
The Garvey Group
(Div. Orora Group)
Jun-17 No Data Milwaukee, WI Orora Group Hawthorn, Australia 4/3/17 Consolidating post-acquisition
Commercial printing, retail display
Link