Mergers & Acquisitions

Transcontinental Inc. this morning announced an agreement to acquire Coveris Americas for C$1.72 billion, subject to customary closing adjustments, in the Montreal company’s continuing push to become a North American leader in flexible packaging. Coveris Americas is a business held by Coveris Holdings S.A., a portfolio company of Sun Capital Partners.

The acquisition, which remains subject to closing conditions and receipt of applicable antitrust approvals, has been approved by the boards of directors of both TC Transcontinental and Coveris Americas. The acquisition is expected to be completed in the third quarter of TC Transcontinental’s fiscal year 2018.

Since entering the market in 2014, this is TC Transcontinental’s seventh flexible packaging acquisition,  including its March 2018 purchase of Multifilm Packaging Corporation.

Coveris Americas, explains Transcontinental, is one of the Top 10 converters of flexible packaging and other value-added products in North America based on revenues for its fiscal year ended December 31, 2017. Headquartered in Chicago, Illinois, Coveris Americas manufactures a variety of flexible plastic and paper products, including rollstock, bags and pouches, coextruded films, shrink films, coated substrates and labels.

As of December 31, 2017, Coveris Americas operated 21 production facilities worldwide, primarily in the Americas, the United Kingdom and Australasia. Coveris Americas has over 3,100 employees, the majority of whom are located in the Americas. For its fiscal year ended December 31, 2017, Coveris Americas generated US$966 million in revenues and US$128 million in Adjusted EBITDA.

“Today’s announcement marks a turning point in TC Transcontinental’s 42-year history. This transaction crystallizes our strategic shift toward flexible packaging and solidifies our commitment to profitable growth,” said Isabelle Marcoux, Chair of the Board, Transcontinental. “We are convinced that this transformational acquisition will be a driver in the creation of long-term value for all of our stakeholders. It is with pride that we begin the next chapter of our successful journey with Coveris Americas, its employees and customers, building on our values of respect, teamwork, performance and innovation.”

Based on Coveris Americas’ financial results for its fiscal year ended December 31, 2017, and on TC Transcontinental's financial results for its fiscal year ended October 29, 2017, the pro forma consolidated revenues and Adjusted EBITDA for the combined entity for fiscal 2017 are estimated at C$3.3 billion and C$564 million, respectively, with flexible packaging accounting for approximately 48 percent of total revenues.

“We are thrilled to announce such a game-changing transaction for TC Transcontinental and to bring our vision of becoming a North American leader in flexible packaging to life,” said François Olivier, President and CEO of TC Transcontinental. “The acquisition of Coveris Americas adds significant depth and scale to our existing platform, with flexible packaging operations now expected to be our largest division in terms of TC Transcontinental's pro forma revenues based on its fiscal year 2017.

“This transaction complements and bolsters our existing product offering in several flexible packaging end markets including dairy, pet food and consumer products,” continued Olivier. “Additionally, it allows us to enter new and attractive flexible packaging end markets such as agriculture, beverage and protein.”

Mark Andy, which develops technologies for the label and packaging industries, has acquired Presstek, a global supplier of DI (direct imaging) offset plates and presses, and CTP solutions. With the Presstek acquisition, Mark Andy explains it now serves as one of the only full-complement solutions providers to the global graphic arts and print industry.


Presstek’s Zahara waterless plates division, which is not being acquired by Mark Andy, will be spun into a new company, Verico Technology, led by former Presstek CEO Yuval Dubois. Verico Technology will focus on expanding its market share for cut sheet aluminum waterless plates and coating technologies in the printing industry as well as venturing into new market segments. “Mark Andy’s acquisition of Presstek is a big win for customers from both organizations,” said Dubois. “We are pleased for the long-term benefits that this initiative will bring to the market.”

Presstek’s team of over 60 technical professionals will be integrated within Mark Andy’s service infrastructure, which the company states makes it the largest, regionally staffed service organization in North America. Certified technicians will support equipment service for brands such as Presstek, ABDick, Ryobi, Heidelberg, Xerox, KBA, Epson and more.

Mark Andy and Presstek have maintained a strong partnership over the years, with Mark Andy Print Products (MAPP) fulfilling all orders in North America for Presstek DI and CTP products.

“Presstek has been a force in the small- and medium-format offset segment for many years. Presstek’s DI plates and equipment and CTP solutions are well respected throughout the industry, and I am happy to welcome the Presstek employees and products into the Mark Andy family,” said Kevin Wilken, CEO, Mark Andy. “We expect Presstek’s customers to benefit from Mark Andy’s stable leadership, tremendous customer service and unmatched product offerings, including MAPP offset print supplies and consumables and Mark Andy digital print equipment.”

Stuart Gallup, appointed as Vice President, Offset Business, Mark Andy, said, “Today's print buyers are seeking shorter print runs, faster turnaround and no compromises in print quality. Mark Andy has a strong commitment to its customers, supporting them with the best solutions to guide them in a direction for success. It’s a privilege to now offer the single point of contact customer experience and streamlined processes that our commercial and in-plant customers have previously enjoyed.”

At the leadership level, Gallup will be accompanied by Ian Pollock, Director, Presstek EAMER, and Ralph Jenkins, Director MAPP Offset Sales in North America.
Sun Chemical acquired the metal deco ink business of PPG, a U.S.-based global supplier of paints, coatings and specialty materials. PPG and Sun Chemical are both long-standing players in the metal packaging industry.



Sun Chemical explains the acquisition reflects its strategy to grow by acquiring businesses that complement its existing operations. The company explains adding PPG will expand both its operational territories and its overall position in the global metal deco market. The purchase, according to Sun Chemical, creates the widest ink portfolio in the metal decoration market.

“With changes in consumer tastes and lifestyles across the world driving increased demand for canned food and beverages, brands are constantly seeking new ways of decorating the metal packaging of their products to differentiate them from the competition,” said Felipe Mellado, CMO and Board Member at Sun Chemical. “The acquisition of PPG’s metal deco ink business means that Sun Chemical will now be able to offer customers an enhanced range of metal deco solutions to help them achieve their marketing goals.”
Transcontinental Inc. today announced that it has acquired Multifilm Packaging Corporation, a flexible packaging supplier located near Chicago in Elgin, Illinois. Employing more than 70 people, Multifilm focuses on the high-end candy and chocolate packaging verticals in North America, and specializes in piece-wraps and high-barrier laminates for the confectionery, snacks and dry foods markets.

Since entering the market in 2014, this is TC Transcontinental’s sixth flexible packaging acquisition, including its previously most recent acquistion of Flexipak in November 2017. Today, the company’s packaging division has close to 1,000 employees and its North American platform comprises seven production plants and one premedia studio.  

Transcontinental explains Multifilm is built around an integrated manufacturing process and distinguishes itself through expertise in cast film extrusion, metallization and demetallization, as well as aluminum foil printing.

“The acquisition of Multifilm Packaging Corporation is aligned with our growth strategy for the packaging division and presents tremendous opportunities,” said François Olivier, President and CEO of TC Transcontinental. “This transaction allows us to enter new high-end confectionery packaging niches and to bolster our offering in this market. Multifilm expands our manufacturing capabilities, namely with aluminum foil printing and demetallization, thereby enabling us to leverage these sought-after processes within our North American packaging platform.”

Multifilm Packaging Corporation has been owned since 2008 by four owner-managers, who will be joining TC Transcontinental. “We are truly proud to join TC Transcontinental, a large corporation with a 42-year history and track record of success,” said Chris Rogers, President of Multifilm. “We are inspired by the long-term growth vision and entrepreneurial spirit of its executives, and we are confident that, together, we will continue to help Multifilm thrive by building on its success, as we have always done."
Goss International’s printing press business and manroland web systems announced plans to merge by mid-2018, subject to regulatory approval. The Contiweb business of Goss International is not included in this transaction. The current shareholders of Goss, American Industrial Partners, and of manroland web, Possehl Group (Lübeck), will continue to co-own the combined company.

Both manufacturers produce web offset printing systems and services for newspapers, commercial products and packaging, and hold what the companies describe as complementary geographic footprints that will help the new entity provide value to clients, particularly in the area of aftermarket services.


“manroland is on the path for continued success. We want to continue to develop this path by creating synergies, fostering the further development of our R&D activities and strengthening our innovation focus,” said Alexander Wasserman, CEO of manroland web.


Mohit Uberoi, CEO of Goss, stated: “This combination will enable us to achieve extensive synergies that will help us optimally serve our customers into the future. The combination will strive to provide a best-in-class product offering and customer service.”

The companies explain, that in addition to the new machinery and service business, the expansion of the business with retrofits and upgrades, and the systematic expansion of e-commerce activities will be major areas of focus.
Muller Martini has taken over the perfect binding and bookline business from Kolbus, which also includes the service and spare parts business for all Kolbus bookbinding systems installed worldwide. Kolbus in turn is setting its focus on the packaging and case making business, parts manufacturing and its foundry business.


“Structural change has changed the graphic arts industry in recent years and our market has become much smaller and versatile at once,” said Bruno Müller, CEO of Muller Martini. “Customers need innovations on a regular basis, which have to be financed with lower sales quantities. Above all, our customers benefit from the efficiency gains bringing together the bookbinding activities.”

The bookbinding business of Kolbus is transferred to the new business unit Müller Martini Buchbinde-Systeme GmbH, which will be integrated into the Muller Martini group with around 250 employees as an independent factory in Rahden, Germany. “This secures the future of the softcover and hardcover business of both the customers and the two machine manufacturers – and thus also jobs in the graphic arts industry,” said Müller.

With 900 employees, Kolbus will remain under the direction of CEO Kai Büntemeyer. “In recent years, the packaging market was growing consistently. We see a good potential and will vigorously expand our current activities in this business,” said Büntemeyer. “There are also very good perspectives in the segment of component manufacturing for sophisticated mechanical engineering companies including Müller Martini Buchbinde-Systeme GmbH and Kolbus Luxury Packaging.”

Muller Martini, a family business that was founded in 1946, has its headquarters in the city of Zofingen (in the Swiss canton of Aargau). It has around 1,800 employees active in the development and production of industrial system solutions for print finishing.
Bell and Howell has acquired the assets of Connecticut-based Gunther International Ltd. to expand its mail-inserting product portfolio. This acquisition follows the purchase of Sensible Technologies one year ago and, most recently, the introduction of CX Touchpoints, described as Bell and Howell’s omnichannel communications platform.

“Acquiring Gunther is another strategic move that strengthens Bell and Howell’s leadership position in an area that is fundamental to our success as a company,” said Ramesh Ratan, CEO, Bell and Howell. “We are committed to the production-mail space and are making substantial investments that will enable us to better serve our customers.”

Gunther International is a manufacturer of high-volume, software-driven mailing systems to the insurance and banking industries. It specializes in complex, high-page-count mail finishing via high-throughput machines, integrity at every stage of the insertion process, and machines that can process both flat and folded mail.

Its Champion software, explains Bell and Howell, is a sophisticated and extremely flexible operating system in mail-finishing equipment control and management systems. “We are excited to add top technical talent to the Bell and Howell service team,” said Jim Feely, Bell and Howell’s Senior VP of Global Service Solutions.
Graphic Packaging Holding Company has completed the combination of Graphic Packaging's existing businesses with International Paper's North America Consumer Packaging business. Graphic Packaging owns 79.5 percent of the combined company and will be the sole manager.

International Paper will own 20.5 percent of the combined company. Graphic Packaging has assumed $660 million (all figures in U.S. dollars) of International Paper debt and concurrently has amended and restated its senior secured credit agreement.

There is no change to Graphic Packaging's current Board of Directors or leadership team. International Paper has a 2-year lock-up on the monetization of their ownership interest and cannot purchase GPK shares for a period of 5 years, subject to limited exceptions.

On a combined basis, Graphic Packaging is now one of the world’s largest integrated paper-based packaging companies with approximately $6 billion of projected revenue and approximately $1 billion of projected EBITDA post-synergies.

Graphic Packaging is one of the largest producers of folding cartons and paper-based foodservice products in North America, has strategic folding carton and foodservice converting positions globally, and holds leading market positions in solid bleached sulfate paperboard, coated unbleached kraft paperboard and coated-recycled paperboard.

“We are excited to close this transformative transaction at the start of the New Year… [We] expect the transaction will significantly increase our mill production and converting scale… The combination meaningfully increases our exposure to the growing foodservice market,” said Graphic Packaging President and CEO Michael Doss.

Headquartered in Atlanta, Georgia, Graphic Packaging holds two Canadian operations in Cobourg and Mississauga, Ontario. In November 2017, Graphic Packaging agreed to acquire the assets of Canada’s Seydaco Packaging Corp. and its affiliates National Carton and Coating Co., and Groupe Ecco Boites Pliantes Ltée.
ModusLink Global Solutions Inc., which is controlled by Steel Partners Holdings, completed the acquisition of privately held IWCO Direct, one of North America’s largest producers of data-driven direct marketing, for US$476 million in cash.

“We have been looking to acquire a profitable business with attractive operations and financials, and with a strong management team in order to leverage our approximately US$2.1 billion in net operating loss carryforwards and cash,” said Warren Lichtenstein, Executive Chairman of ModusLink. “We found a great fit in IWCO Direct. We essentially double the size of our company and add significant earnings and free cash flow.”

Lichtenstein also pointed to IWCO Direct’s client base with a range of Fortune 500 companies, and significant opportunities to drive both top- and bottom-line results. “We intend to aggressively grow IWCO Direct,” he said, “organically and through acquisitions.”

IWCO Direct, which becomes a wholly owned subsidiary of ModusLink Global Solutions, will continue to be run by Jim Andersen, who has been CEO since 1999. Jack Howard, President of Steel Partners, and William Fejes Jr., President of Steel Services Ltd., join the ModusLink board of directors.

For the last 12 months through October 2017, IWCO Direct had net revenue of US$470.6 million, net income of US$18.9 million and Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) of US$82.2 million.

For the last 12 months through October 2017, ModusLink had net revenue of US$417.8 million, a net loss of US$22.5 million and negative EBITDA of US$3.8 million, although net loss and EBITDA improved by US$32.5 million and US$28.0 million year-over-year, respectively.

IWCO Direct’s range of services includes strategy, creative and production for multichannel marketing campaigns, as well as postal logistics programs for direct mail. Through its Mail-Gard product, IWCO Direct also offers business continuity and disaster recovery services to protect against unexpected business interruptions, along with providing print and mail outsourcing services.

IWCO Direct claims to be the largest direct mail production provider in North America, with the largest platform of continuous digital print technology and a growing direct marketing agency service.
Baldwin Technology Company Inc., which develops process automation technologies, consumables and services for the print, packaging, textile and corrugated industries, has acquired QuadTech Inc. from its parent company, Quad/Graphics.

Baldwin, describing the acquisition as the creation of a vision and inspection print technology powerhouse, adds all of QuadTech’s technology and locations across the Americas, Europe, China, Japan and India. Headquartered in Sussex, Wisconsin, QuadTech maintains a global sales and service operation to sell its automated control systems in more than 100 countries.

Baldwin plans to integrate QuadTech within two of its existing divisions, including Web Printing Controls and PC Industries. The resulting global platform is to operate as Baldwin Vision Systems, focusing on print process automation, inspection and related services. Karl Fritchen, current QuadTech President, is to lead the new Baldwin segment.

“QuadTech will serve as a catalyst for the formation of our new Baldwin Vision Systems segment... Together, we provide our customers an unmatched portfolio in commercial and newspaper automation, and I am very excited about the additional capabilities we will gain in the packaging markets,” said Brent Becker, President and CEO of Baldwin. “The work QuadTech has done recently on color within the packaging market clearly places us as the industry leader and we have aggressive plans to build upon that position.”

The new segment’s technologies will span closed-loop automation for registration, inking, colour management, web handling and inspection for the commercial, newspaper, labels, packaging, converting and publication gravure industries.

“The combination of products and expertise held within both companies will enable us to reach areas of the market we were unable to reach individually,” said Fritchen. “From an international operations and market perspective, each party’s strengths are highly complementary.”

QuadTech is Baldwin’s fifth acquisition since joining the BW Forsyth Partners family of companies in 2012, and the fourth completed in 2017. This includes the May 2017 purchase of Air Motions Systems. BW Forsyth Partners is the investment arm of multibillion-dollar global manufacturing and engineering consulting firm Barry-Wehmiller.
Cascades says it is acquiring four plants in Ontario to strengthen its position in the containerboard packaging sector, and the purchase of an ownership position in Tencorr Holdings Corp. The company also announces an increase in its equity holding of the Greenpac Mill LLC.

“We are very pleased to expand our presence in Ontario and increase our stake in Greenpac for the second time this year. These transactions align perfectly with our vision and strategy for our containerboard activities,” said Cascades president and CEO Mario Plourde.

Acquired from the Coyle family, the four following plants are geared toward the manufacturing of boxes and speciality products:

• McLeish Corr-a-Box Packaging & Design – Etobicoke
• Brown Packaging – Burlington
• Coyle Corrugated Containers Inc. – Scarborough
• Coyle Packaging (Peterborough) Ltd. – Peterborough

According to the company, the transaction will allow Cascades to expand its presence in Ontario, increase its production capacity by 500 million square feet per year, and strengthen its ability to serve customers in this region. The plants already have procurement agreements with Greenpac, and as such the transaction will have little impact on Cascades’ integration rate, it notes.

Cascades has also acquired the Coyle family’s 33-percent stake in Tencorr, a company specialized in manufacturing sheet stock for box producers.

Furthermore, Cascades has also acquired an additional interest in Containerboard Partners, one of Greenpac’s shareholders, thus increasing its holdings in Greenpac to 66.1 per cent from 62.5 percent. The company has been consolidating the Greenpac results since April 2017. 

“These new assets will support our growth by providing us with increased capacity and flexibility. This transaction will also enable us to better serve our customers as we will be better positioned to provide them with the packaging solutions they seek. I would also like to welcome all of the employees of these new plants to Cascades,” said Charles Malo, president and COO of Cascades Containerboard Packaging.

The total cost of the transaction amounts to $49 million, of which $21 million is related to the increased stake in Greenpac and its new position in Tencorr. The containerboard packaging plants were acquired for a consideration of $28 million, including an assumed debt of $4 million, which represents a multiple of 6.5 times the adjusted operating income before depreciation of these operations, and excludes anticipated synergies.

Founded in 1964, Cascades produces, converts and markets packaging and tissue products composed mainly of recycled fibres.
Graphic Packaging Holding Company, through two of its subsidiaries, Graphic Packaging International and Graphic Packaging International Canada, agreed to acquire the assets of Seydaco Packaging Corp. and its affiliates National Carton and Coating Co., and Groupe Ecco Boites Pliantes Ltée. The acquisition is subject to standard closing requirements and is expected to close in the fourth quarter 2017.

This acquisition follows Graphic Packaging’s late October 2017 move to merge International Paper’s packaging operations in a transaction valued at US$1.8 billion. Expected to close in early 2018, this merger with IP would create one of the largest folding-carton and packaging operations in North America, generating approximately US$6 billion in revenues annually.

Seydaco is a privately held Canadian folding-carton producer headquartered in Mississauga, Ontario, focusing on the foodservice, food, personal care, and household goods markets. More specifically, Seydaco has become one of the country's llargest suppliers of print work for manufacturers of cake, pie, pastry and pizza cartons.

Seydaco purchased National Carton in April 2015. The company today converts approximately 20,000 tons of paperboard annually and operates three converting plants located in Mississauga, Ontario, St.-Hyacinthe, Québec, and Xenia, Ohio.

Seydaco’s operations generated revenues of approximately $40 million over its most recent fiscal year. “The announced transaction is consistent with our strategy to pursue acquisitions that allow us to grow our folding carton volume in attractive geographies and end-markets, improve our cost position, increase our mill to converting plant integration levels over time, and that we can close at compelling post-synergy EV/EBITDA multiples,” said Michael Doss, President and CEO, Graphic Packaging.

Graphic Packaging explains synergies from the acquisition will be driven by the integration of additional paperboard tons and cost efficiencies. On a post-synergy basis, the company explains the EV/EBITDA multiple for this transaction is expected to be below 6.0X.

“We are delighted to join Graphic Packaging. Our employees and customers will truly benefit from this transaction,” said David Seychell, President of Seydaco. “Our history of providing customers with high-quality, value-added packaging solutions and our speed-to-market philosophy combined with their strong, global position will bring much added value to the paperboard packaging marketplace."

Graphic Packaging Holding Company, headquartered in Atlanta, Georgia, is global company with two existing Canadian operations in Cobourg and Mississauga, Ontario.
In a move to expand its product mix throughout Western Canada, Spicers Canada, a division of Central National Gottesman Inc., has acquired Shippers Supply. Expected to close by the end of November 2017, the acquisition gives Spicers Canada a stronger position in the distribution of shipping, packaging and warehouse supplies in the region.

Privately owned and headquartered in Edmonton, Alberta, Shippers Supply operates nine locations throughout Western Canada, and has supplied corrugated boxes, labels, tape, stretch film, shelving, packaging supplies and warehouse equipment to the region since 1975.  

“The acquisition of Shippers Supply is another critical step forward in many product categories we want to grow throughout our North American distribution business,” said Andrew Wallach, CNG President and Chief Executive Officer.

Spicers Canada President Cory Turner added that the acquisition of Shippers Supply fits with his organization’s strategy to leverage its significant distribution capabilities in new ways. “The opportunity to acquire Shippers Supply adds significant capabilities and expertise that will be invaluable in meeting our company’s market strategy,” said Turner. “Extending product solutions both inside and outside of our core markets creates immediate opportunities that align well with our growth initiatives.”

Shippers Supply will operate as an independent division of Spicers Canada, working the organization’s existing operations and distribution network in Western Canada.
HP Inc. completed its acquisition of Samsung Electronics Co. Ltd.’s printer business in a deal valued at US$1.05 billion. The move was first announced in September 2016, when HP stated the acquisition – the third largest in HP’s history – positions it to disrupt the US$55 billion copier industry.

HP explains A3 technology represents its largest growth opportunity in business printing. The Samsung acquisition also strengthens HP’s position in A4 laser printing, in addition to providing intellectual property of more than 6,500 print patents and a workforce of nearly 1,300 researchers and engineers with expertise in laser technology, imaging electronics and supplies and accessories.

“Together, we will build on more than 30 years of print leadership to accelerate our strategy, disrupt new market opportunities, and provide our customers and partners with unique and highly innovative print solutions,” said Dion Weisler, President and CEO, HP Inc.

As part of the agreement, Samsung will be making a US$100 million to US$300 million equity investment in HP through open market purchases.
Quebec-based Transcontinental Inc. has acquired a 55-person packaging company located in the St-Laurent borough of Montreal.

The deal for Les Industries Flexipak Inc. is Transcontinental’s fifth North American packaging acquisition since 2014 as the printing, publishing and media company pivots toward packaging and away from newspapers and magazines.

“This transaction extends our footprint to Eastern Canada by adding a Montreal-based facility equipped with a state-of-the-art platform, and gives us the opportunity to further develop our existing business relationships with retailers in the country,” said François Olivier, Transcontinental President and CEO.

Founded in 1998, Flexipak makes packaging for consumer goods firms, food processors and retailers, and specializes in flexographic printing, lamination as well as bag and pouch making. It focuses on food-processing markets like frozen fruits and vegetables, seafood, grain, bakeries, snack food, nuts, coffee, bottled water, canned goods, office paper products overwrap and coex shrink film.

Transcontinental stated it intends to retain all of the company’s employees and managers.
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