Friday, August 7, 2015

EFI Walks the Digital Fashion Runway - July 2015 M&A Activity


Digital printing of textiles takes center stage as EFI stakes out a leadership position with its acquisition of Reggiani Macchine, the highly specialized Italian manufacturer of textile printing equipment. In addition to the acquired company’s more traditional rotary and flatbed screen printing devices, Reggiani produces a line of industrial digital inkjet machines that are bring the digital revolution to the world of fashion and fabrics. With EFI’s expertise in front-end image processing and color management technology; can it be too long before consumers can order completely customized digitally printed wardrobes? 

As EFI moved into digital textile printing equipment, others were busy in July consolidating the business of researching and supplying specialty inks designed for printing on textiles. Italy-based JK Group acquired Sawgrass Industrial, a US-based innovator of digital sublimation inks. Primary applications for the company’s products include fashion apparel, fabrics for furnishing and décor products, promotional decoration of garments, soft signage and just about any else you can think of that is made from printed textiles. Sawgrass Technologies, which had been previously split from the now divested industrial products division, will continue to operate as an independent company focused on non-industrial digital printing for the less than 42” wide format market.

These transactions follow right on the heels of Epson’s acquisition last month of For.Tex, an Italian distributor of textile printing inks and manufacturer of treatment agents used in textile printing. Epson and For.Tex have worked together for several years to develop and market Epson’s Monna Lisa industrial inkjet digital textile printer, manufactured by Italian equipment manufacturer Robustelli using Epson’s inkjet technology and print heads.

Headquartered in Novedrate, Italy, the JK Group itself is the result of a combination last year of Kiian Digital and J-Teck3, each of them leaders in inks used in digital textile printing. Both companies, as well as the companies acquired by EFI and Epson, operate within the region just south of Lake Como in Italy, noted as the heart of the Italian and European textile industry and a short drive from the runways of international fashion capital Milan.

Book Printing

Visant Corporation, owner of several print-centric companies including yearbook publisher Jostens, exited its holding in Phoenix Color. Headquarted in Maryland, Phoenix Color specializes in book printing, including cover components. The printing company focuses on products that require full color printing throughout, such as children’s illustrated books. The company also prints folding cartons, labels and commercial printing products that may require specialized decorating techniques such as foil stamping and embossing.

The buyer of Phoenix Color is ALJ Regional Holdings, a public company traded on the OTC Pink sheets, and which has other investments in business process outsourcing and flooring products. ALJ reportedly is paying $90 million for Phoenix, or just slightly north of 1 times the acquired revenues of $88 million. Based on increased EBITDA that ALJ expects of $22.9 million, and assuming that there is not much synergy between its holdings, we can infer that the deal was valued at approximately 3.9 times EBITDA.

Printing Equipment

In addition to the acquisition of the manufacturer of digital textile printing machines, EFI simultaneously announced the acquisition of Israel-based Matan Digital Printers. The company manufactures a line of UV-ink super-wide high-speed grand format printers used to produce large indoor and outdoor graphic banners and wraps. With the wide profile, high-speed roll-fed and in-line finishing capabilities of the acquired lines, EFI is positioning the Matan line as a lower-cost volume alternative to its high-end Vutek line of digital UV flatbed printers. The acquired company also produces smaller machines used to digitally print specialty items such as traffic signs and license plates.

OKI Data Corporation, which you may remember as the manufacturer of those early (and noisy) PC-compatible dot matrix printers, acquired Seiko I Infotech, a manufacturer of wide format inkjet printers for the graphics market, as well as toner-based wide format printers for the architectural, engineering and construction market.

Private equity firm American Industrial Partners is investing once again in the printing equipment industry, this time acquiring the venerable US-based web offset press manufacturer Goss International, which has been operating under the ownership of the Shanghai Electric Corporation. Goss presses are ubiquitous in the newspaper industry and also include the Sunday line of commercial presses acquired from Heidelberg back in 2004. The fund’s portfolio currently includes Presstek, another US-based company that offers digitally imaged plates and imagers for offset presses, as well as a line of offset presses using its plate technology. An earlier investment in Mark Andy, manufacturer of flexo presses, was sold to the management team in a leveraged buyout in August 2014.

Paper

Assets in the paper industry continue to shift as overall volumes decline in the face of continuing pressure on printed products from electronic media and content distribution. Neenah Paper acquired FiberMark paper company in July, which itself had acquired Crocker Technical Papers last year. The acquisition brings the Crocker specialty paper mill into the Neenah fold alongside the Crane Technical Materials company acquired by Neenah last year. The acquisitions provide diversity outside the company’s traditional strength in printing papers, adding paper products in filtration, electrical insulation, and other industrial uses for fiber-based products.

Japan Pulp & Paper acquired the remaining 49% shares it did not already own of Gould Paper, a New York-based distributor of printing papers in the US and western Europe. The age of family-owned printing paper distributors is drawing to a close - this deal follows the two acquisitions of regional distributors earlier this year by Central National-Gottesman, another global paper distributor.

BW Paper Systems, formed last year when privately-owned Barry Wehmiller consolidated its paper processing companies in conjunction with a simultaneous acquisition of three other companies, is again in the market, this time acquiring the paper processing equipment of bankrupt German company Bielomatik Leuze. Bielomatik is probably best known in the commercial printing market for its sheeting equipment sold by Heidelberg under the CutStar brand. Upon completion of the deal, BW Paper Systems will have global revenues of $400 million, producing several brands of machinery that cut, count, wrap, corrugate, die cut, glue and otherwise process paper products.



2015 July - 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
Releases
American Industrial Partners No Data New York, NY Goss International
(Sub. Shanghai Electric Corp.)
No Data Durham, NH 7/31/15 No Data Acquisition Web printing presses Link
NPG Management No Data Sheetfed Operation NPG Printing
(Sheetfed Operation)
No Data Sheetfed Operation 7/31/15 No Data Mngt. buyout Commercial printing Link
Firespring No Data Lincoln, NE Cornerstone Print & Marketing
(plus 4 others)
No Data Omaha, NE 7/27/15 No Data Acquisition Printing & copying Link
JK Group No Data Novedrate, Italy Sawgrass Industrial No Data Mt. Pleasant, NC 7/24/15 No Data Acquisition Sublimation & pigment inks Link
Nikkei $1,372 Osaka, Japan Financial Times
(sub. Pearson)
$519.0 London, UK 7/23/15 $1,320 Acquisition Global newspaper Link
Bemis $4,300 Neenah, WI Emplal Participações $75.0 Sao Paulo, Brazil 7/21/15 No Data Acquisition Rigid plastic packaging Link
Neenah Paper $905.8 Alpharetta, GA ASP FiberMark
(sub. American Securities)
$160.0 W. Springfield, MA 7/20/15 $120.0 Acquisition Paper coating & finishing Link
AlphaGraphics North Austin No Data Austin, TX Lone Oak Marketing No Data Round Rock, TX 7/17/15 No Data Asset Acquisition Marketing service provider Link
BW Paper Systems
(sub. Barry-Wehmiller)
No Data Phillips, WI Bielomatik Leuze
(Paper Processing Business)
No Data Neuffen, Germany 7/17/15 No Data Acquisition Paper sheeting equipment
(combined $400 Mil revenue)
Link
OKI Data Corporation
(sub. Oki Electric)
$6,500 Tokyo, Japan Seiko I Infotech No Data Chiba-shi, Japan 7/15/15 No Data Acquisition Wide format printers Link
ALJ Regional Holdings $190.0 New York, NY Phoenix Color
(sub. Visant)
$88.0 Hagerstown, MD 7/12/15 $90.0 Acquisition
(Houlihan Lokey)
Book printing Link
Welch Packaging Group No Data Eklhart, IL American Corrugated Products No Data Columbus, OH 7/8/15 No Data Merger Corrugated boxes Link
Multi Packaging Solutions No Data New York, NY Blueprint Media No Data London, UK 7/2/15 No Data Acquisition Packaging design Link
Electronics for Imaging (EFI) $796.3 Foster City, CA Reggiani Macchine No Data Bergamo, Italy 7/1/15 $154.4 Acquisition Textile inkjet printing Link
Electronics for Imaging (EFI) $796.3 Foster City, CA Matan Digital Printers No Data Rosh Ha'Ayin,
Israel
7/1/15 $34.0 Acquisition Grand format inkjet printing Link
Japan Pulp & Paper $4,278 Tokyo, Japan Gould Paper $1,000 New York, NY 7/1/15 No Data Purchase of outstanding shares Paper distribution Link
Dynagraphics No Data Decatur, IL Wood Printing Service No Data Decatur, IL 7/1/15 No Data Acquisition Commercial printing
(Combined $9Mil revenue)
Link


2015 July - 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:
Press Time Printing, Inc. 7/24/15 No Data 15-04868 Fallbrook, CA 9th Southern CA
San Diego
Laura S. Taylor Samuel Kelsall, V  Commercial printing
Greenpack Inks and Coatings, Inc. 7/20/15 No Data 15-50477 Mooresville, NC 4th Western NC
Charlotte
Laura T. Beyer Stephen J. Romeo  Inks & coatings


2015 July - 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
Digital Printworks Jul-15 No Data Merrillville, IN None N/A 7/2/15  Commercial printing Link
The Oregonian
(sub. Advance Publications)
Aug-15 No Data Portland, OR Advance Publications New York, NY 7/1/15 Printing outsourced to Signature Graphics Link

Tuesday, July 7, 2015

Cloak and Dagger Inks Fight Counterfeiters – June 2015 M&A Activity


Australian company YPB announced that it has acquired California-based printing company, Continuous Forms Control (CFC), to introduce its covert ink compounds into the US market. YPB develops and manufactures unique ingredients that are blended into inks and coatings and that cannot be seen, damaged or removed from the product or package being printed. This effectively creates a specific “product DNA” which forever identifies that product as the genuine article, discernable to anyone with the corresponding handheld scanners programmed to recognize the specific secret compound. The company anticipates that the packaging, fashion label and pharmaceutical sectors will utilize its printing services at the acquired company to combat counterfeiters who will not be able to match the unique chemical markers blended into the inks. The company completes the loop with its Brand Reporter software that enables field agents to use their smart phones to report suspicious items to corporate headquarters, including photos with geo-located tags. YPB’s most recent investor presentation projects revenues in the US to grow to $10 million as CFC incorporates the covert inks into millions of product labels. 

In addition to YPB, other acquirers continue to invest in the two basic elements common to all printing, ink and the underlying substrates. Sun Chemical, the world’s largest ink manufacturer, expanded its reach into Southeast Europe, acquiring full control of its joint venture in the region. Epson, manufacturer of inkjet printing devices, acquired Italian company For.Tex which develops, manufactures and sells specialty inks and coatings used to digitally print textiles.

The consolidation of the distribution of printing papers, the most commons printing substrate, continues at a steady pace. Global paper and pulp distributor Central National-Gottesman added another distributor to its network late last month with the purchase of Los Angeles-based Performance Paper. The acquired company was added to its Spicers division which distributes printing papers throughout the western states. This acquisition marks the fifth printing papers distributor that the family-owned Central National-Gottesman company has acquired since 2012, building on the network begun in 1984 when company acquired Lindenmeyr and shortly thereafter bolted on the Munroe company. On a much smaller scale, Mac Papers, a roll-up of mom-and-pop paper distributors in the Southeast, acquired Packaging Professionals in Lewisburg, Tennessee.

Private equity investment firm The Jordan Company added to its investment in the category of plastic printing substrates primarily used in packaging applications. Transilwrap, acquired by The Jordan Company in 2013 (see The Target Report – November 2013), itself acquired Ellis Industrial Packaging, adding to its line of converted films and specialty plastics used in printing and packaging. Sun Capital Partners acquired Canadian paper and packaging company CanAmPac through its portfolio company PaperWorks, adding to its significant investments in the printing, packaging and paper industries. The acquisition includes the Strathcona mill that manufactures paperboard for packaging exclusively using recycled fibers.

Commercial Printing and Document Management

Taylor Corporation emerged as the winning bidder for printing and document management company Standard Register in the 363 sale in bankruptcy with an offer of $307 million. Based on the most recently reported revenues of $904 million, Taylor’s offer equals 34% of trailing revenues, a price higher than the 29% of projected revenues that Quad/Graphics paid for the presumably more financially sound Brown Printing in April 2014. Standard Register filed bankruptcy just this past March, reportedly unable to meet its obligations from the debt incurred with its own acquisition of print management company Workflow One in 2013 (see The Target Report – August 2013). One day after winning Standard Register, Taylor Corporation announced the acquisition of NEPS, a much smaller New Hampshire-based document management company.

Commercial printer Excelsior Printing is closing its printing operations in North Adams, Massachusetts, after 125 years, transitioning the remaining business to Integrity Graphics in Windsor, Connecticut. The venerable printing company operated in a classic New England brick mill building and had been owned by the Crane family since 1970, operating first under the ownership of Crane & Co., manufacturers of specialty papers including for much of the world’s paper currency, then under David Crane since 2008.

Jones Printing in Chattanooga, Tennessee continued the un-rolling of the once acquisitive roll-up Nationwide Argosy, as the management team completed a management buyout, returning the company to its original status as a single stand-alone commercial printing company.

Retail and Display

GSP, a retail display design and production company located in Clearwater, Florida acquired Great Big Pictures in Madison, Wisconsin, adding 80,000 square feet of manufacturing space and expanding to the Midwest. Great Big Pictures specializes in the production of in-store graphics and display.

Privately owned packaging powerhouse Menasha Packaging is back on our deal log for the fourth time with an acquisition in the retail display segment, acquiring Portable Packaging in Mississauga, Ontario. Portable Packaging provides design services and pre-packed displays for retailers and consumer goods companies.

Packaging

Flexible packaging continues to be a very active segment for deals. PE firm Mason Wells acquired Minneapolis-based AWT Labels & Packaging, a producer of flexible packaging, digitally printed labels, and shrink sleeves. Coveris, a portfolio company of Sun Capital Partners based in Chicago announced two acquisitions of flexible packaging companies in June, expanding its presence as a major player in the increasingly global packaging segment, with the acquisition of Elldex Packaging Solutions in New Zealand and the other being Guatemala-based Olefinas which also operates in Mexico. Fortis Solutions Group acquired two label printing companies, Color Craft Label in Memphis, Tennessee and Kopco Graphics in Westchester, Ohio which also produces flexible packaging as well as labels.

Newspapers

The churn in the regional and local newspaper industry continues unabated. Adams Publishing Group was active for the second time this year, acquiring the Southern Maryland Newspapers from Post Community Media, including 13 publications and associated websites. This follows six deals, each involving multiple titles, completed by Adams in 2014. New Media Investment Group announced the acquisition of The Columbus Dispatch in Ohio which ends 110 years of family ownership of the paper and its related publications. New Media now publishes 126 daily publications, in excess of 550 community publications and over 460 related websites.



2015 June - 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
Releases
CC Industries
(sub. Henry Crown & Co.)
No Data Chicago, IL J.L. Clark
(sub. Clarcor)
$77.0 Rockford, IL 6/30/15 No Data Acquisition Metal & plastic packaging Link
Mason Wells No Data Milwaukee, WI AWT Labels & Packaging No Data Minneapolis, MN  6/28/15 No Data Acquisition Flexible packaging Link
Gateway Packaging No Data St. Louis, MO Apex Bag No Data Wapakoneta, OH 6/23/15 No Data Acquisition Multiwall bags Link
Taylor Corp. No Data Mankato, MN NEPS No Data Salem, NH 6/18/15 No Data Asset Acquisition Document mngt. Link
Taylor Corp. No Data Mankato, MN Standard Register $904.0 Dayton, OH 6/17/15 $307.0 363 Sale in Ch. 11 Printing & document mngt. Link
Integrity Graphics No Data Windsor, CT Excelsior Printing No Data N. Adams, MA 6/13/15 No Data Acquisition Commercial printing Link
Adams Publishing Group No Data Minneapolis, MN Southern Maryland Newspapers
(Div.  Post Community Media)
No Data Waldorf, MD 6/12/15 No Data Acquisition Community newspapers Link
Jones Printing No Data Chattanooga, TN Jones Solutions
(Sub. Nationwide Argosy)
No Data Houston, TX 6/12/15 No Data Mngt. buyout Commercial printing Link
Transilwrap No Data Franklin Park, IL Ellis Industrial Packaging No Data South Glamorgan,
UK
6/9/15 No Data Acquisition Specialty film & foils Link
Fortis Solutions Group No Data Virginia Beach, VA Color Craft Label No Data Memphis, TN 6/5/15 No Data Acquisition Label printing Link
Fortis Solutions Group No Data Virginia Beach, VA Kopco Graphics No Data West Chester, OH 6/5/15 No Data Acquisition Label printing Link
GSP No Data Clearwater, FL  Great Big Pictures No Data Madison, WI 6/5/15 No Data Asset Acquisition Retail graphics & display Link
PaperWorks Industries No Data Bala Cynwyd, PA CanAmPac No Data Napanee, ON 6/5/15 No Data Acquisition Paperboard mills & packaging Link
J&S Business Products No Data Ayer, MA ValueCalendars.com No Data Ayer, MA 6/4/15 No Data Buyout & spin-off Online print storefronts Link
Menasha Packaging No Data Neenah, WI Portable Packaging No Data Mississauga, ON 6/4/15 No Data Acquisition Retail displays Link
New Media Investment Group $760.9 New York, NY The Columbus Dispatch No Data Columbus, OH 6/3/15 $47.0 Acquisition Regional & newspapers Link
YPB No Data Sydney, Australia Continuous Forms Control No Data Laguna Niguel, CA 6/2/15 No Data Acquisition Forms and label printing Link
Gannett $6,080 McLean, VA York Daily Record
(sub. Digital First Media)
No Data New York, NY 6/1/15 No Data Acquisition Metro & regional newspapers Link
Gannett $6,080 McLean, VA Texas-New Mexico Newspapers
(sub. Digital First Media)
No Data New York, NY 6/1/15 No Data Acquisition Metro & regional newspapers Link
Coveris
(Port. co. Sun Capital Partners)
$2,759 Chicago, IL Olefinas No Data Villa Nueva,
Guatemala
6/1/15 No Data Acquisition Flexible packaging Link
Sun Chemical $3,500 Parsippany, NJ Sun Chemical SE Europe
(5 countries)
$30.0 Aspropyrgos,
Greece
6/1/15 No Data Buyout of JV Printing inks & coatings Link
Mac Papers No Data Jacksonville, FL Packaging Professionals No Data Lewisburg, TN 6/1/15 No Data Asset Acquisition Paper & supply distribution Link
Coveris
(Port. co. Sun Capital Partners)
$2,759 Chicago, IL Elldex Packaging Solutions No Data Auckland,
New Zealand
6/1/15 No Data Acquisition Flexible packaging Link
Epson $9,100 Tokyo, Japan For.Tex € 24.0 Fino Mornasco,
Italy
6/1/15 No Data Acquisition Textile inks Link


2015 June - 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:
Custom Media Group 6/23/165 No Data 15-11302 Santa Barbara, CA 9th Central CA
Santa Barbara
Peter Carroll Carissa N. Horowitz Custom publications
Printec 6/22/15 No Data 15-06422 Clearwater, FL 11th Middle FL
Tampa
K. Rodney May  Jeffrey R. Thibault Commercial printing


2015 June - 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
B&W Press Jun-15 No Data Georgetown, MA None N/A 6/25/15 Direct mail printing Link
Gannett - Printing Plant Jul-15 No Data Maple Grove, MN Gannett Co. McLean, VA 6/2/15 USA Today outsourced to Star Tribune
St. Cloud Times outsourced to ECM Printing
Link