Saturday, November 7, 2015

The Box is in Demand- October 2015 M&A Activity


The Box is in – paperboard, corrugated, decorated, foil-stamped, bar-coded, laminated, textured, embossed, pearlized, diecut, folded, glued, large and small. Folks in the business of printing love the box. Unlike the box’s troubled cousin, commercial printing, the box is reordered on a regular basis and is far less subject to disruption by online internet-based technologies.

Graphic Packaging International announced the acquisition of Carded Graphics, a Virginia-based printer of folding cartons used to package food, craft beers and other consumer products. The company utilizes two traditional offset printing presses and diecutting technologies. The acquired company, Carded Graphics, is clearly a small catch relative to the buyer, which has revenues in excess of four billion dollars. Nonetheless, regardless of the relative small size of the acquisition, the transaction is consistent with the company’s clearly articulated strategic plan to focus on the production of folding cartons. Graphic Packaging also announced in October that it was expanding into the Mexican market for folding cartons with the acquisition of G-Box. The acquired company prints and manufactures folding cartons and corrugated boxes.

As reported over the past four years in The Target Report, Graphic Packaging has been consistently executing on its folding carton strategy. In December 2014, the company acquired Toronto-based Norampac from Cascades, adding three Canadian folding carton plants as well as a two paperboard mills, thus integrating raw material production into its folding carton business. Previous expansion of its international footprint in folding carton production includes the company’s acquisition of the UK-based companies Benson Group and Contego Cartons, in 2014 and 2012 respectively, having also added the Netherlands-based A&R Cartons in 2012.

In alignment with its strategic plan, Graphic Packaging has divested assets unrelated to its core focus on folding cartons. The company sold its multi-wall bag and kraft business to the Mondi Group and its Di-Na-Ca Label Group to Multi-Color Corporation, both transactions completed in 2014.

Another very active rollup play in the packaging industry, Multi Packaging Solutions, is also focused on the box, obtaining the majority of its revenue from the folding carton segment. Backed by private equity firms The Carlyle Group and Madison Dearborn Partners, Multi Packaging Solutions, became a publically traded company in October. Among its stated objectives in its prospectus is the acquisition of additional packaging companies. The company has appeared in our deal log no less than seven times over the past four years, most notably when it acquired AGI-Shorewood in 2014 2013 (see The Target Report – November 2014) and Chesapeake Services in 2013 (see The Target Report – November 2013).

Electronics for Imaging (EFI), the dominant company providing MIS systems to the printing and related industries, expressed its love for the simple box with its acquisition of Corrugated Technologies. The acquired company, based in San Diego, California, provides manufacturing and management information software to the corrugated packaging market.

Commercial Printing

M&A activity in the commercial printing segment remained spookily quiet in October, as it has been for several months, despite expectations that consolidation activity will be brisk in the commercial printing segment. What we see instead is that the recent uptick in commercial printing business activity, however modest, is providing some breathing room and profits for company owners that are happy to chug along, hoping that the slightly rising tide, combined with reduced competition courtesy of the great recession, will bring back the happy times.

A select few, however, in the commercial printing segment, are in the market, not consolidating, but rather making strategic acquisitions that broaden their portfolio of services. Dome Printing in Sacramento, California, acquired Bel Aire Displays, expanding the company’s geographic footprint and furthering its strategic goal to grow its presence in the market for in-store and out-of-home retail displays. Earlier this year, Dome acquired wide format printer and retail display company Color Solutions.

Drummond Press, based in Jacksonville, Florida, announced its second acquisition in Atlanta, Georgia, acquiring the print division of RGI. The digital printing operation is focused on data driven marketing programs and lead generation programs.

Book Printing

Bang Printing in Brainerd, Minnesota, acquired Sentinel Printing in St. Cloud, Minnesota. With extensive in-house binding capabilities, Bang focuses on the short and mid-run book manufacturing market. Similar to previous acquisitions by Bang of Hess Print Solutions in Ohio (see The Target Report – May 2013) and Victor Graphics in Maryland, this latest addition increases the company’s presence in the book printing segment.

Visant continued its ongoing exit from print-related businesses in its portfolio, selling yearbook company Jostens to consumer products conglomerate Jarden. Earlier this year, Visant sold book printer Phoenix Color (see The Target Report – July 2015) and in 2014 Visant divested its interest in direct mail printer Lehigh Direct which was acquired by SG360. Visant retains its school-branded apparel and awards, and is now fully divested of print assets.



2015 0ctober - 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
CCL Industries $2,750 Toronto, ON Banknote Corp of America
(Sub. Sennett Security Products)
$35.00 Greensboro, NC 10/29/15 $45.0 Acquisition Specialty labels, security docs Link
RR Donnelley $11,520 Chicago, IL Mediant Communications No Data New York, NY 10/26/15 No Data Minority Interest Shareholder communications Link
Graphic Packaging $4,140 Atlanta, GA G-Box No Data Guadalupe, México 10/22/15 No Data Acquisition Folding cartons Link
Multi Packaging Solutions
(Port co. Madison Dearborn)
$1,617 New York, NY Multi Packaging Solutions $1,500 New York, NY 10/21/15 $201.0 IPO Packaging printing Link
Borregaard $477.3 Sarpsborg, Norway  Flambeau Rivers Paper No Data Park Falls, WI 10/21/15 No Data Acquisition Lignin production Link
Dover $7,240 Downers Grove, IL JK Group No Data Novedrate, Italy 10/22/15 No Data Acquisition Textile inks Link
Drummond Press No Data Jacksonville, FL RGI (Print division) No Data Marietta, GA 10/21/15 No Data Acquisition Digital printing Link
RR Donnelley $11,520 Chicago, IL Courier Advisory Group No Data Tampa, FL 10/21/15 No Data Acquisition Logistics Link
Deluxe $1,760 Shoreview, MN Datamyx
(Port co. Halyard Capital)
No Data Boca Raton, FL 10/20/15 $160.0 Acquisition
(Petsky Prunier)
Marketing analytics Link
Jarden $8,430 Boca Raton, FL Jostens
(Sub. of Visant)
$740 Minneapolis, MN 10/14/15 $1,500 Acquisition Yearbooks & commemoratives Link
Barry-Wehmiller $2,000 Phillips, WI Winkler+Dünnebier (W+D) No Data Neuwied, Germany 10/13/15 No Data Acquisition Envelope mfg. equipment Link
Bang Printing No Data Brainerd, MN Sentinel Printing No Data St. Cloud, MN 10/14/15 No Data Acquisition Book printing Link
Bernard Group No Data Chanhassan, MN Hammer Direct No Data Minneapolis, MN 10/13/15 No Data Acquisition
(Quazar Capital)
Online commercial printing Link
Buyers Lab (BLI) No Data Fairfield, NJ InfoTrends No Data Weymouth, MA 10/13/15 No Data Acquisition Digital imaging research Link
Boston Globe No Data Boston, MA Gannett Boston Offset No Data Norwood, MA 10/9/15 No Data Acquisition Newspaper printing Link
Supremex $135.9 LaSalle, QC Classic Envelope $13.0 Douglas, MA 10/8/15 No Data Acquisition Envelope manufacturer Link
Gannett $2,960 McLean, VA Journal Media Group $450.0 Milwaukee, WI 10/7/15 $280.0 Acquisition Metro & regional newspapers Link
Electronics for Imaging (EFI) $837.1 Foster City, CA Corrugated Technologies (CTI) No Data San Diego, CA 10/7/15 No Data Acquisition MIS system for packaging Link
DOME No Data Sacramento, CA Bel Aire Displays $8.2 Richmond, CA 10/6/15 No Data Acquisition Retail display Link
Graphic Packaging $4,140 Atlanta, GA Carded Graphics No Data Staunton, VA 10/1/15 No Data Acquisition Folding cartons Link
Novolex
(Port. Co Wind Point Partners)
$2,000 Hartsville, SC Wisconsin Film & Bag
(Port. Co. Argosy Partners, et al.)
$62.0 Shawano WI 10/1/15 No Data Acquisition Plastic wraps & bags Link


2015 October - 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:
Project Digital, Inc. 10/26/15 No Data 15-62189 North Canton, OH 6th Northern Ohio
Canton
Russ Kendig Chris G. Manos  Design & print production


2015 October - 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
R.J. Bielen Laser Graphic Arts 11/5/15 No Data New Brunswick, NJ None N/A 10/28/15 Diecutting & finishing Link
Paperworks Industries - printing facility May-16 No Data Hamilton, ON Paperworks Industries Bala Cynwyd, PA 10/22/15 Consolidating ops to Kitchener, ON Link
SP Fibers - paper mill Nov-15 No Data Newberg, OR WestRock Norcross, GA 10/19/15 Newsprint paper mill Link
Harland Clarke - printing facility Jan-16 No Data San Antonio, TX Harland Clarke San Antonio, TX 10/20/15 Check printing Link
J&M Reproduction 11/5/15 No Data Troy, MI None N/A 10/20/15 Copy shop Link
Gannett Publishing - Printing facility Feb-16 No Data Springfield, VA Gannett McLean, VA 10/6/15 Newspaper printing Link
Gannett Boston Offset Dec-15 No Data Norwood, MA Gannett McLean, VA 10/5/15 Newspaper printing / Sale of Co. Link