If there is any doubt that McGraw-Hill felt that it was shedding what it views as a long term drag on its performance, the buyer, Apollo Global Management, is a self-proclaimed group of “contrarian, value-oriented investors with significant distressed expertise.” An analyst quoted in Bloomberg opined that the educational division is “migrating to a more subscription-based business model, which would have more predictable revenues, and could conceivably have better profitability because you could eliminate the manufacturing and inventory costs. It’s all about figuring out ways to distribute your content and broaden its appeal in the market.” For the book printing industry, the message is clear – expect Apollo to push down on the throttle and accelerate the change to non-print delivery channels.
For parents of college students, and certainly the students themselves, it’s hard to get upset about the move to digital materials in education. Who in either demographic has not complained about the high cost of oversized textbooks, too heavy to carry to class, and often with hundreds of unread pages at semester’s end? For me, it was an easy decision to buy our graduate student a Kindle last year. She can download PDF’s as needed, and purchase only those textbooks where print really makes a difference (she’s studying art history, so beautifully printed books still add tremendous value).
Other deals announced in November include three large transactions in the packaging sector, all purchases of European printers by North American companies. Graphic Packaging Holding, of Marietta, Georgia, was behind two of the deals, purchasing specialists in food and consumer products. In the third packaging deal, CCL Industries of Toronto, Canada, picked up a Scotland printer of labels for distillers of Scotch whiskey and other spirits.
On the bankruptcy side of the ledger, there were several filings of small printing companies, all of which chose to file for Chapter 7 liquidation rather than attempt to restructure in Chapter 11. A vanity press publisher, Pentland Press, apparently no longer attracted to what it saw in the mirror, also filed for liquidation. We found one company, a die cutter, willing to give restructuring in bankruptcy a go, filing for Chapter 11 in central California.
2012 November - 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 | $1,268 (CN) | Toronto, ON | John Watson & Co. Ltd. | £12.0 | Glasgow, Scotland | 11/30/12 | No Data | Acquisition | Spirits labels | Link | |||
Graphic Packaging Holding | $4,206 | Marietta, GA | A&R
Cartons (Beer & Beverage Sector) |
No Data | Netherlands | 11/28/12 | € 26.0 | Acquisition (Cash+Debt) |
Packaging, food & consumer | Link | |||
Apollo Global Management | $172 | New York, NY | McGraw Hill Education | $2,300 | New York, NY | 1/26/12 | $2,500 | Acquisition | Educational books & services | Link | |||
Arandall | No Data | Menomonee Falls, WI | Schumann Printers | No Data | Fall River, WI | 11/26/12 | No Data | Strategic Partnership | Direct mail, publications | Link | |||
Electronics for Imaging (EFI) | $591.6 | Foster City, CA | Technique | No Data | Leeds, UK | 11/19/12 | No Data | Acquisition | MIS/ERP systems for publishers & printers | Link | |||
Graphic Packaging Holding | $4,206 | Marietta, GA | Contego Cartons | $260.0 | Bagshot, UK | 11/16/12 | £81.0 | Acquisition (Cash+Debt) |
Packaging, food & consumer | Link | |||
Canfield & Tack | $14.0 | Rochester, NY | Dellas Graphics | $6.0 | Syracuse, NY | 11/13/12 | No Data | Acquisition (NAPL) |
Commercial print & services | Link | |||
Graphic Visual Solutions | No Data | Greensboro, NC | Hutchison Allgood | No Data | Winston-Salem, NC | 11/9/12 | No Data | Acquisition (NDP) (NAPL) |
Commercial
print & services ($25Mil combined revenue) |
Link | |||
Vision Integrated Graphics Group | No Data | Chicago, IL | InfoComm & Wagner Printing | No Data | Freeport, IL | 11/5/12 | No Data | Tuck-in of sales | Diversified Graphic Services | Link | |||
2012 November - Bankruptcy Filings in the Printing, Packaging, Paper & Related Industries | ||||||||||||
Filing Party |
Date Case Filed |
Pre-Petition Revenues ($Mil ) |
Case # |
Filing Party Address |
Circuit |
Region & City |
Judge |
Attorney for Debtor |
Notes |
|||
Chapter 11 Filings: | ||||||||||||
Ram's Die Cutting & Finishing, Inc. | 11/8/12 | No Data | 12-35154 | Chino, CA | 9th | Central
CA Riverside |
Meredith A. Jury | David R. Chase | Bindery services | |||
Chapter 7 Filings: | ||||||||||||
Pentland
Press, Inc. (DBA Ivy House Publishing Group) |
11/28/12 | No Data | 12-08385 | Raleigh, NC | 4th | Eastern
NC Raleigh |
J. Rich Leonard | Philip W. Paine | Vanity press book publishing | |||
Advanced Digital Graphics | 11/27/12 | No Data | 12-14333 | Moorpark, CA | 9th | Central
CA Los Angeles |
Peter Carroll | Daniel A. Higson | Digital printing | |||
Kokomo Quick Print, Inc. | 11/14/12 | No Data | 12-13459 | Kokomo, IN | 7th | Southern
IN Indianapolis |
James K. Coachys | Mark E. Kuntz | Printing & copying | |||
Excalibur Graphics, Inc. | 11/13/12 | No Data | 12-78449 | Marietta, GA | 11th | Northern
GA Atlanta |
James R. Sacca | M. Denise Dotson | Commercial printing | |||
Fokus, Inc. | 11/8/12 | No Data | 12-36630 | Kenilworth, NJ | 3rd | New
Jersey Newark |
Donald H. Steckroth | Melinda D. Middlebrooks | Photo graphics & signage | |||
Universal Business Forms Inc. | 11/2/12 | No Data | 12-08905 | Carolina, PR | 1st | Puerto
Rico San Juan |
Mildred Caban Flores | Jose M. Prieto Carballo | Business forms | |||
Love Graphics | 11/1/12 | No Data | 12-51979 | Greeneville, TN | 6th | Eastern
TN Greeneville |
Marcia Phillips Parsons | Dave B. Jordan | Commercial printing | |||