Mergers & Acquisitions
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.
International Paper’s packaging operations will merge with Graphic Packaging International (GPI) in a transaction valued at US$1.8 billion. As a result IP will receive a 20.5 percent ownership interest in the company, which will be one of the largest folding carton and packaging operations in North America, generating approximately $6 billion in revenues annually.

The transaction, expected to close in early 2018, is to be structured as a new partnership comprised of Graphic Packaging’s existing businesses and International Paper Company's North America Consumer Packaging business. Graphic Packaging Holding Company (GPK) will own 79.5 percent of the partnership and will be the sole operator. There will be no change to GPK’s current Board of Directors or leadership team.

The new partnership will assume US$660 million of International Paper debt. It will expand existing paper-based packaging for GPK and build new platforms for growth in SBS foodservice markets and folding-carton converting.

“After evaluating a range of strategic options, we believe this transaction represents excellent value for IP's shareholders,” said International Paper Chairman and CEO Mark Sutton. “Investing in Graphic Packaging gives IP the opportunity to benefit from a much stronger value-creation consumer packaging platform, while allowing us to remain focused on growing value in our core businesses.”

International Paper’s North America Consumer Packaging business produces and converts solid bleached board used in a variety of fiber-based foodservice products such as hot and cold cups, cartons, paper plates, food containers and liquid packaging. The transaction includes 3,900 coated paperboard and foodservice employees located at 10 locations in the United States and United Kingdom.

GPK, headquartered in Atlanta, Georgia, is global company with two Canadian operations in Cobourg and Mississauga, Ontario.
DATA Communications Management entered into an agreement to acquire privately held BOLDER Graphics of Calgary, Alberta. DATA has arranged a new $5 million senior credit facility to help fund the acquisition, which will be for a total purchase price of approximately $4.9 million. Closing is expected to occur on or about November 10, 2017, subject to customary conditions.

Kevin McCoy, President, CEO and founder of BOLDER, is expected to remain with the company for approximately six months to assist in the transition. Dave Watt, VP, Sales and Marketing, will remain with the company and continue to serve BOLDER’s clients.

This $4.9 million purchase price is comprised of $2.0 million payable in cash on closing (net of shareholder loan repayments and transaction expenses), $1.0 million through the issuance of common shares of DATA, $0.9 million in the form of a subordinated, unsecured 6.0% interest-bearing vendor take back note to be payable over a 24 month period, and the assumption of approximately $1.0 million in outstanding long term indebtedness.

BOLDER is a western Canadian marketing communications business, tracing its roots back more than 40 years. Its core capabilities are in large-format digital printing, point of sale signage, corporate packaging, outdoor signage and vehicle graphics. BOLDER also specializes in loose-leaf bindery and stationery and other commercial print capabilities. The company has approximately 40 employees operating in a 59,000-square-foot facility.

“BOLDER’s customer base of leading western Canadian retailers and other brands will benefit from our own capabilities in Calgary, as well as our national footprint and technology solutions,” said Michael Sifton, CEO of DATA. “This acquisition further strengthens our large-format presence in the market and is expected to provide immediate synergies when combined with our state-of-the-art Calgary centre of excellence.”

BOLDER generated approximately $7 million in revenues (unaudited) for the fiscal year ended January 1, 2017. DATA intends to relocate BOLDER’s staff and operations into DATA’s 165,000-square-foot facility in Calgary. This DATA facility produces a range of sheetfed lithography, digital and wide-format print services, variable print-on-demand solutions and provides warehousing, fulfillment and distribution services.
The SGIA Expo will retire after its 2018 event in Las Vegas, Nevada, in favour of a new exhibition called PRINT United, co-owned by the Specialty Graphic Imaging Association (SGIA) and NAPCO, which, among other media brands, publishes Printing Impressions magazine in the United States. NAPCO has media brands in commercial, in-plant and package printing sectors.

SGIA Expo has traditionally focused on wide-format imaging, textile, and signage applications at its growing trade show, which recently wrapped up in New Orleans (October 10 to 12). More than 19,000 people attended the 2017 SGIA Expo, which featured nearly 600 exhibitors.

PRINT United is to be billed as a brand-new event that will launch in Dallas, Texas, October 23 to 25, 2019. Ford Bowers, currently CEO of SGIA, will serve as PRINT United’s CEO and Mark Subers of NAPCO Media will be its President.

“PRINT United is a strategic response to what the industry has been asking for,” said Bowers. “It's about the wealth of opportunities for printers and suppliers that result from the convergence of markets and technology.”

PRINT United, explains the organization, will focus on the opportunities presented by the convergence of printing technologies and markets. It will have a broader range of printing and finishing technologies and media on the expo floor, covering industry segments from garment to graphics, packaging to commercial, and industrial.
AlphaGraphics Inc., a global franchisor of design, printing, marketing and communications businesses, has been purchased by fellow franchisor Mail Boxes Etc. (MBE) Worldwide. Following the acquisition, MBE will hold a network of approximately 2,600 locations in 39 countries, including nearly 500 locations in the U.S.

In addition to its own printing operation interests, MBE specializes in third-party logistics, concentrating on shipping, micro and related retail-logistics services. MBE also acquired the U.S.-based PostNet franchise system in April 2017.

AlphaGraphics will continue to operate as an independent company and will retain its current management team, with headquarters remaining in Salt Lake City. “This is an exciting development for the AlphaGraphics franchise system,” said Gay Burke, AlphaGraphics Executive Chair. “Combining forces with MBE Worldwide creates unique opportunities to synergize with colleagues similarly steeped in managing a franchise-based network of entrepreneurs.”
Electronics For Imaging Inc. has purchased Escada Systems based in the United Kingdom and with operations in the United States, which develops Corrugator Control systems for the packaging market

EFI has a growing interest in corrugated production, primarily based on its drupa 2016 introduction of the Nozomi C18000 high-speed single-pass LED inkjet press. The company has also developed versions its Fiery DFE, inks, and the EFI Corrugated Packaging Productivity Suite aimed at the sector.

The addition of Escada's technology, providing control and traceability for the corrugation production process, will enable EFI to expand the Productivity Suite’s value to sheet feeders and corrugated box plants. “The addition of Escada makes EFI a one stop shop for enabling packaging companies to improve the quality, efficiency and profitability of the corrugation process, using their existing corrugators,” said Gabriel Matsliach, Senior VP and GM, EFI Productivity Software.

Financial terms of the acquisition were not disclosed, but EFI explains it is not expected to be material to EFI’ss Q4 or full year 2017 results. Escada employees, including founder and former principal Gavin Bushby, have joined EFI's Productivity Software business unit.
ICON Digital Productions Inc. of Markham, Ont., has acquired controlling interest in Asterisk Media, a Toronto-based creative studio. Asterisk Media will now operate as a division of ICON Digital and will be rebranded as ICON Motion Inc.  They will continue to operate from their current Liberty Village location.

Asterisk specializes in creating video content for multiple platforms. “We started this company after seeing the impact of how digital enabled viewers to have two-way conversations with brands,” said PJ Lee, Founder and President of Asterisk Media, who will serve as President of the newly created ICON Motion division. “We decided to build a company that was nimble and able to produce high-quality, high-frequency content that matched our partners’ content strategies.”

ICON explains the deal will enable it to offer Asterisk’s suite of services such as commercial production and post-production, as well as 360/VR and livestream. “This is an excellent fit with our overall growth strategy to be a multi-faceted visual communications company and is consistent with our company mandate to be ‘All Things Visual’” said Juan Lau, CEO and President of ICON Digital.
 
This is ICON’s second acquisition of 2017, following its February purchase of Toronto Trade Printers (TTP). The ICON group of companies reached $32 million in sales last year prior to the TTP and Asterisk acquisitions. With offices in Toronto, Markham, Montreal and New York City, ICON Digital now operates four divisions with high-end production capabilities for display graphics, digital signage, commercial printing and video production.
The C.J. Group of Companies has merged with Annan & Sons, both of which are based in Toronto, Ontario. Both Paul and John Annan, along with several of their staff members, are scheduled to join C.J. Graphics in that company’s new Mississauga location at the end of October 2017.

C.J. Group explains Paul and John Annan will be overseeing the management of their division, including production and sales of their current clients. Going forward, John, who served as President of Annan & Sons, will also have a position on C.J.’s management team.

“As we started planning to relocate our production, we recognized C.J. Graphics as a great fit for our customers,” said John Annan. “C.J. Graphics is well known for great quality and service. This merger will allow us to continue to offer these high standards to our customers. C.J. Graphics is also very innovative in new technologies which will give us more products to offer to our clients.”
Transcontinental Inc. has announced specifics regarding the sale of some of its Quebec-based newspapers assets, a plan that was first made public in April 2017 when the company launched a process to sell all of its newspapers in Quebec and Ontario, which are controlled under the Montreal company’s TC Media operation. That move came just weeks after selling its newspaper assets in other provinces.

The Quebec and Ontario newspaper sales process, which Transcontinental expected to span several months, involves 93 local and regional publications and their related web properties, including the Métro Montreal newspaper.

Transcontinental is selling its two Drummondville-based publications, L'Express Wednesday Edition and L'Express Weekend, to a Canadian corporation in part led by the company’s former TC Media General Manager for this region, Dave Beaunoyer. The 19 employees of these newspapers are transferred to the new entity, along with four employees from TC Media's production team.

Six of the publications within TC Media’s newspaper sell-off announced last April are going to Gravité Média, a group that includes Julie Voyer, former General Manager at TC Media for the Montérégie region. These publications include: Le Journal Saint-François, Le Soleil de Châteauguay, Brossard Éclair, Le Courrier du Sud, L'information d'Affaires Rive-Sud, and Le Reflet (Delson).

The 55 employees of these publications are transferred to Gravité Média. In addition, nine employees from TC Media's production and finance teams will continue their careers with Gravité Média.

TC Media also announced the sale of its weekly Le Peuple Lotbinière to MELIORMÉDIA Inc. Three employees are transferred to the purchaser.
Sun Chemical has acquired Joules Angstrom U.V. Printing Inks Corp., a manufacturer of UV printing inks for converters in the commercial, packaging and specialty printing markets.

“This partnership will give both Sun Chemical and Joules Angstrom numerous opportunities to provide customers with expanded product lines and services… we plan to work together to provide customers with more exciting and innovative UV printing ink solutions,” said Charles Murray, President of North American Inks, Sun Chemical.

Based in Pataskala, Ohio, Joules Angstrom was founded in 1999 when Patrick Carlisle, who currently serves as the company’s President, began to focus specifically on UV printing ink.

In addition to its Pataskala location (just outside Columbus), Joules Angstrom has a customer service centre is located in Chicago, which is supported by other branch locations in Minneapolis, Dallas and Los Angeles.
Cansel has been an Autodesk Platinum Partner, supporting customers across Canada, for more than eight years. In 2015, Cansel merged its Ontario Autodesk business unit into SolidCAD. Now, SolidCAD and Cansel have consolidated their national operations forming the largest Canadian Autodesk Platinum Partner, newly branded as SolidCAD, a Cansel Company.

“SolidCAD and Cansel have been two of our most valued resellers in the Canadian market,” said Marcus Tateishi, Senior Partner Manager at Autodesk. "The strength of these highly specialized teams now working as one will be a benefit to our mutual customers. This new partnership provides expert personnel committed to the Autodesk product portfolio across the country and is an investment we are proud of."   

With more than 10 offices across the country, SolidCAD now describes itself as the only national Autodesk reseller owned in Canada, operating in both official languages. SolidCAD has a combined team of more than 40 technical consultants across the country to help firms overcome challenges with design, production, collaboration and project deliverables.

“Having worked closely with SolidCAD since the 2015 merger of our Ontario Autodesk business, we are eager to bring this newly combined organization to the marketplace in Canada.” said Stephen Fletcher, Vice President, Cansel. “This milestone represents the opportunity to bring a broader product portfolio and depth of expertise to our clients and confirms our investment in providing top quality customer service.”

SolidCAD specializes in technology that supports multiple industries including Architecture, Engineering, Construction, Civil Infrastructure and Manufacturing.
Pollard Banknote Limited of Winnipeg, Manitoba, entered into a definitive agreement to purchase all of the issued and outstanding common shares of INNOVA Gaming Group Inc. based in Los Angeles, California. The purchase agreement, which is not subject to due diligence or financing conditions, is unanimously supported by INNOVA board and its largest shareholder holding approximately 41 percent of outstanding shares.

After initially expressing interest in acquiring INNOVA’ shares in March, Pollard Banknote increased its offer to $2.50 per share for a total equity value of approximately $51 million. This represents a 19 percent premium to Pollard Banknote’s original offer of $2.10 per Common Share and a 66 percent premium to INNOVA's closing share price of $1.51 on the TSX on March 9, 2017, the last trading day prior to the public announcement of Pollard Banknote's initial proposal to acquire INNOVA.

“This transaction delivers significant value to INNOVA's shareholders and is the result of an extensive and rigorous process conducted by the special committee of the INNOVA Board to identify value maximizing alternatives for INNOVA's shareholders,” said Richard Weil, Chairman and Chief Executive Officer of INNOVA. “The INNOVA Board is unanimous in its recommendation that INNOVA's shareholders tender their Common Shares to the revised offer."

Under the terms of the new agreement reached on August 1, 2017, INNOVA has agreed, among other things to grant Pollard Banknote a right to match any alternative transaction proposal made by another party, and to pay a fee of approximately $1.5 million to Pollard under certain circumstances if the transaction is not completed.

“We are very pleased to have the support of the INNOVA board and look forward to combining the strengths of our two companies,” said John Pollard, Co-Chief Executive Officer of Pollard Banknote. "INNOVA and its Diamond Game operating business represent unique assets that fit well within Pollard Banknote's expanding product portfolio.

“Pollard Banknote and INNOVA share many of the same customers,” continued Pollard, “and we believe that the combination of our two firms will allow Pollard Banknote to further grow its partnership with lotteries and charitable organizations seeking to expand the funds they generate for good causes and to grow the combined revenue base of Pollard Banknote and INNOVA."

INNOVA develops unique games and products for the global gaming industry, with particular focus on state and provincial lotteries. Through INNOVA's wholly-owned subsidiary, Diamond Game Enterprises, INNOVA focuses on enhancing the revenues of government-sponsored lotteries and other regulated operators by offering its unique "extended play" products in traditional and non-traditional gaming venues.

INNOVA's primary product is its third generation Lucky Tab machine, an instant ticket vending machine that dispenses tickets while simultaneously displaying the results of each ticket on a video monitor.
Sydney Stone of Mississauga, Ontario, has purchased Vertex Graphic and Business Equipment of Vancouver, BC.

“Acquiring Vertex allows Sydney Stone to expand its footprint into a major market and provide Vertex customers with more choices, new programs and economies of scale that will help them to operate their businesses more efficiently,” said Michael Steele, who purchased Sydney Stone in 2008 with business partner Dylan Westgate. “ They will also continue to enjoy great service from [former Vertex owners] Brad and Anne, people they have come to trust and rely upon.”

With an existing national footprint, Sydney Stone’s acquisition of Vertex provides a stronger customer base in British Columbia and Alberta. Both companies distribute and service a range of print finishing equipment.

“Anne and I have made this decision in order to bring our customers a wider product range and additional programs and to concentrate more specifically on our great service offering,” said Brad Munro of Vertex. “We’re looking forward to achieving great things with Michael and Dylan.”
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