Thursday, March 7, 2013

Will this “Most Unforgettable Character” Survive? – February 2013 M&A Activity

A “Most Unforgettable Character” in the life of millions of Americans, mine included, the Reader’s Digest, filed to reorganize in Chapter 11 bankruptcy; its second trip to the bankruptcy court in less than four years. The news brought back memories of reading the pint-sized magazine, ostensibly written for the grownups in the house, but eagerly consumed by all who could read. I was encouraged monthly to learn new words since “It Pays to Increase Your Word Power,” and felt better since “Laughter is the Best Medicine." I was entertained with some really "Amazing Anecdotes", and got a glimpse of what it meant to be American from "Humor in Uniform" and "Life in these United States." Like millions of other former readers, I have not read (or have even seen) a copy of the Reader’s Digest in years, however the impact remains. As the delivery of content via print continues to decline and moves ever more to phones, pads, surfaces and tablets, I suspect that this former cultural icon will continue to struggle for survival.

Xerox purchased Impika, the French maker of aqueous inkjet printing technology, signaling the continued development of and investment in robust high speed inkjet technologies, raising the question, “Is inkjet the next disruptive technology to rock the printing industry?”

Office Depot and Office Max agreed to merge, creating an $18 billion company that will compete with Staples. Although printing is not central to either Office Depot/Max or Staples, each has built formidable competitive positions in the copy, short run digital print and low end wide format sectors. Our deal log is littered with Chapter 7 liquidations of small print and copy shops, fighting and losing in the battle to compete with these giants. Not to be outdone, two large franchisors of copy shop businesses, Allegra Holdings and Sign and Graphics Holdings agreed to merge into one holding company, re-aligning their operations along two lines – copy shop printing and wide format signage.

Packaging continues to be a bright sector in the industry, with deals announced that are synergistic, global and strategically positive, as opposed to the distressed deals that characterize the commercial print business. Amcor, based in Australia, purchased the tobacco and specialty folding carton business from AGI-Shorewood. Constantia Flexibles, based in Austria, acquired the Spear Group, printer of beverage labels. New York City based private equity firm First Atlantic Capital acquired C-P Flexible Packaging in York, Pennsylvania.

Wausau paper continued its exit from the printing paper business, announcing the closure of its mill in Brainerd, Minnesota, with plans to focus on the tissue paper sector. Clearly, as the printing of content continues to be in the dumper, there are certain uses of paper that simply cannot be transitioned to electronic delivery. Hackman Capital Partners purchased certain assets from bankrupt Catalyst Paper, including a closed mill, as well as the Apache Railway. Hackman has indicated that it will continue to operate the railway; however there was no mention of re-opening the paper mill.

Rationalization of newsprint capacity continued in February as two newspaper publishers each closed their own printing facilities and outsourced the printing to other publishers in nearby regions. The Colorado Springs Gazette will now be printed in Denver, while American Consolidated Media will move its four newspapers and shopper to Forum Communications’ printing facility in Duluth, Minnesota. AFL Quality in New Jersey filed for Chapter 7 liquidation, following the closure of its plant, as reported in the December Target Report. Vertis announced the closing of four printing facilities which were left out of the deal when Quad acquired most of the Vertis assets.

2013 February - 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


Fort Dearborn No Data Elk Grove Village, IL FetterGroup
(Label business unit)
No Data Louisville, KY 2/28/13 No Data Divestiture Sale of label business Link
Xerox $23,000 Norwalk, CT Impika No Data Aubagne, France  2/26/13 No Data Acquisition Aqueous inkjet presses Link
Hackman Capital Partners No Data Las Angeles, CA Catalyst Paper No Data Snowflake, AZ 2/25/13 $13.5 Asset purchase
(Perella Weinberg)
Paper mill assets Link
Office Depot $10,700 Boca Raton, FL Office Max $6,920 Naperville, IL 2/20/13 $1,170 All-stock merger Copy & wide format offerings Link
Allegra Holdings
(Alliance Franchise Brands)
No Data Plymouth, MI Sign and Graphics Holdings No Data Columbia, MD 2/19/13 No Data Merger Print & copy shop franchisors
($380Mil combined revenue)
Constantia Flexibles No Data Vienna, Austria Spear Group $195.0 Mason, Ohio 2/18/13 No Data Acquisition Beverage labels Link
Amcor $12,193(AUS) Victoria Australia AGI-Shorewood
(US, Asia & Latin America)
$126.0 Stamford, CT 2/15/13 $114.8 Asset purchase Tobacco & specialty cartons Link
First Atlantic Capital No Data New York, NY C-P Flexible Packaging No Data York, PA 2/13/13 No Data Acquisition
(Mesirow Financial)
Flexible packaging Link
EPS-Doublet No Data Denver, CO Think BIG Solutions No Data Denver, NJ 2/12/13 No Data Acquisition Event graphics, digital print Link
Intellectual Ventures &
RPX Corporation
No Data Bellevue, WA
San Francisco, CA
Kodak $7,200 Rochester, NY 2/1/13 $527.0 Asset sale in Ch.11 Sale & licensing of digital imaging patents Link

2013 February - Bankruptcy Filings in the Printing, Packaging, Paper & Related Industries

Filing Party

($Mil )

Case #

Filing Party Address


Region & City


Attorney for Debtor

Chapter 11 Filings:
Mountain View Printing, Inc. 2/26/13 No Data 13-51068 Mountain View, CA 9th Northern CA
San Jose
Arthur S. Weissbrodt Charles B. Greene Commercial printing
Rose Business Forms Company 2/25/13 No Data 13-30605 Fowlerville, MI  6th Eastern MI
Daniel S. Opperman-Flint Donald C. Darnell Business forms
Topline Printing & Graphics, Inc. 2/21/13 No Data 13-13909 Riviera Beach, FL 11th Southern FL
West Palm Beach
Erik P. Kimball Julianne R. Frank  Commercial printing
Digital Printworks, LLC 2/21/13 No Data 13-20451 Merrillville, IN  7th Northern IN
J. Philip Klingeberger Richard M. Davis Commercial print, wide format
RDA Holding Co. 2/17/13 No Data 13-22233 White Plains, NY 2nd Southern NY
White Plains
Robert D. Drain Joseph H. Smolinsky Parent of Reader's Digest & others.
Clearview Printing Co., Inc. 2/5/13 No Data 13-10990 Perkasie, PA  3rd Eastern PA
Bruce I. Fox Jon M. Adelstein Continuous forms
Chapter 7 Filings:
AFL Quality, Inc. 2/15/13 No Data 13-12921 Voorhees, NJ 3rd New Jersey
Newark, NJ
Novalyn L. Winfield Pro Se Newsprint and publication printer
Insta-Print, Inc.  2/6/13 No Data 13-01490 Fort Myers, FL 11th Middle FL
Caryl E. Delano David Lampley Printing & copying

2013 February - 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


Smith's Printing Apr-13 No Data Cambridge, MD None N/A 2/22/13 Stationary & commercial printing Link
Wausau Paper Mill May-13 No Data Brainerd, MN Wausau Paper Mosinee, WI 2/22/13 Closing technical specialty paper mill Link
American Consolidated Media 4/1/13 No Data Hibbing, MN Forum Communications Duluth, MN 2/15/13 Transferring newsprint operations Link
Colorado Springs Gazette 4/5/13 No Data Colorado Springs, CO The Denver Post Denver, CO 2/15/13 Transferring newsprint operations Link
Vertis Ohio Printing Facility 5/1/13 No Data Medina, OH Vertis Communications Baltimore, MD 2/12/13 Formerly American Color Graphics plant Link
Vertis New Jersey Printing Facility Apr-13 No Data North Brunswick, NJ Vertis Communications Baltimore, MD 2/12/13 Formerly Webcraft plant Link
Vertis Texas Printing Facility 4/1/13 No Data Dallas, TX Vertis Communications Baltimore, MD 1/22/13 Plant not included in Quad Graphics deal Link
Vertis Canadian Printing Facility 1/19/13 No Data Fort Erie, ON Vertis Communications Baltimore, MD 1/19/13 Plant not included in Quad Graphics deal Link