Mergers & Acquisitions

Shortly after filing for Chapter 11 with the U.S. Bankruptcy Court, Böwe Systec Inc. today entered into an asset-purchase agreement with Versa Capital Management and co-investment partner Access Value Investors Inc. Böwe Systec controls BÖWE BELL + HOWELL and its Canadian subsidiary Böwe Bell + Howell International Ltd.

Philadelphia-based Versa holds the majority of BBH’s outstanding secured debt, which will be resolved through the sale. Within its investment portfolio, Access Value Investors also holds NCP Solutions LLC, which is a document management firm with printing, mailing and electronic-delivery capabilities, as well as Indianapolis-based Zimmer Custom-Made Packaging.

In addition to the Chapter 11 filing, BBH Canada will also request that the Ontario Superior Court of Justice in Toronto recognize the U.S. proceeding as a foreign main proceeding, which would allow the company to seek ancillary relief from the Canadian Court as required.

The companies expect the sale process to be completed within 90 days.

Ricoh Company announced that it will be incorporating two of its divisions, InfoPrint Solutions and the marketing/planning resources of Ricoh Production Printing Business Group in Japan. The new entity will be known as Ricoh Production Print Solutions (RPPS). The headquarters of this new division will be in West Caldwell, New Jersey.

”The decision to locate the headquarters of RPPS in the United States is an indication of how important this market is for future success,” said Shiro Kondo, President & CEO, Ricoh Company, Ltd. “This is a clear indication of our desire to increase our marketplace penetration in the US and around the world. We fully expect to see the positive results of this in the coming months and years,” he said.

Former Chairman and CEO Shiro (Simon) Sasaki, of Ricoh Europe will take on the role of Chairman and CEO of RPPS. The new group will report to Ricoh's Production Printing Business Group in Tokyo, Japan.

Ricoh says this realignment will provide a more effective and efficient approach to "this highly competitive marketplace."

In June 2007, Ricoh acquired 51 percent of IBM's Printing Systems Division, forming a partnership known as InfoPrint. In June 2010, Ricoh purchased IBM's remaining interest in InfoPrint, making it a wholly owned subsidiary. InfoPrint has approximately 2,700 employees globally, with its former headquarters being in Boulder, Colorado.

Heidelberger Druckmaschinen AG acquired Belgian-based software developer CERM. Headquartered in Oostkamp with a staff of 26, CERM specializes in the development of Management Information Systems (MIS) for commercial and label printing operations. 

“By acquiring CERM, a well-known software specialist in Western Europe, Heidelberg is expanding its portfolio of Management Information Systems,” said Marcel Kiessling, member of the Management Board responsible for Heidelberg Services. “We aim to present a fully integrated MIS solution with central data management in combination with our Prinect print shop workflow at drupa 2012.”

Heidelberg estimates the global printing market volume for MIS to be around EUR200 million.

“We’ll continue to serve all our existing customers in all our markets,” said Tom Musschoot, former owner CERM, who will stay on as Managing Director of the software entity. “Additionally, as part of Heidelberg, we will be able to extend our business to a truly global level by making use of Heidelberg’s worldwide presence and international sales channels.”

John Barney, President of Barney Printing Ltd., reached a deal with John Hueston, President of Aylmer Express Graphics Group, to amalgamate the two Ontario-based printing companies. 

Barney Printing is a 77-year-old company that primarily provides commercial printing for the London, Waterloo, Guelph and Toronto markets. Barney Printing will continue to operate out of its current location in Woodstock. Barney Printing has been family owned since its inception in January 1934.

“The versatility that the Express adds, particularly in digital print and mail services, is essential today,” said John Barney. “Our customers will save time and money through the convenience of 1-stop shopping."

Aylmer Express is a fourth-generation family business, founded 130 years ago, and now operates out of four production sites, including London, Woodstock, Aylmer and Richmond Hill locations. Early last year, Aylmer Express bought Accell Graphics of London, Ontario.

“This is a great fit. We have similar backgrounds and both are dedicated to maintaining high standards and premium quality,” said Hueston. “This puts us firmly in the 40-inch press market. Few can match our years of experience in everything from sheetfed printing and full bindery services to large-format output, to mail and data management.”

Cascades Inc., based in Kingsey Falls, Quebec, reached an agreement to sell Dopaco Inc., its converting business for the quick-service restaurant industry, to Reynolds Group Holdings Ltd. for US$400 million.

According to Cascades, net proceeds from the transaction will mainly be used to pay down debt, while the deal also includes a commitment from Dopaco to purchase boxboard from Cascades over the next five years.

“While we have always considered our ownership in Dopaco to be a good investment, I am pleased to announce this transaction which unlocks significant value for our shareholders,” said Alain Lemaire, President and CEO of Cascades. “In fact, this divestiture is part of our overall strategy to gain more financial flexibility and streamline our portfolio of assets to pursue the development of our core tissue, packaging and recovery operations.”

The transaction is expected to close before the end of April 2011.

Winnipeg-based FP Canadian Newspapers Ltd. has acquired Derksen Printers Ltd. and its weekly newspaper The Carillon, located 65 kilometres away in Steinbach, Manitoba. Derksen Printers was founded in 1936 and today produces both commercial web and sheetfed printing.

“This is an excellent addition for FPLP and we’re very excited about the future prospects of both the commercial printing business and the award-winning weekly newspaper,” said Ron Stern, CEO of FP. “The south-eastern region of Manitoba is the fastest growing area of the province, and the Derksen family has built a business that plays a key role in supporting the commerce and continued growth of this region.”

In its most recent fiscal year, Derksen Printers generated combined printing and publishing revenues of $5 million, while employing approximately 50 people in its 26,500-square-foot facility. The Carillon newspaper has a weekly circulation of 8,000.

“We believe there’s a solid business base, and a motivated group of employees who we look forward to working with to grow the business in this very important part of the province,” said Dan Koshowski, CFO of FP.

FP Newspapers Inc. holds 49 percent of FP Canadian Newspapers Ltd., which owns the Winnipeg Free Press, Brandon Sun, and the Canstar Community News division that controls eight community newspapers in the Winnipeg region.

Cascades Inc. of Kingsey Falls, Quebec, reached an agreement to sell its Norampac Avot-Vallée mill to a private-equity firm called OpenGate Capital. The company expects the transaction to be completed on March 1, 2011.

Located in the north of France, Norampac Avot-Vallée specializes in the manufacturing of linerboard (white Testliner) made from 100 percent recycled fibres. It produces more than 145,000 tons annually and has approximately 160 employees.

“This transaction is part of our strategy to simplify our portfolio of assets, reduce our debt and concentrate on developing and improving the competitiveness of our key operations in packaging, tissue papers and recovery,” said Alain Lemaire, Cascades' President and CEO. “Therefore, I wish to thank all the employees for their involvement and efforts over the last 20 years.”

Electronics For Imaging of Foster City, California, expanded its business-management software portfolio with the acquisition of Streamline Development LLC, which develops the PrintStream MIS product. PrintStream CEO Laurence Snyder is joining EFI’s Advanced Professional Print Software (APPS) division.

PrintStream technology focuses on direct mail, as well as general mailing and fulfillment services provided by printing companies. In particular, the PrintStream Warehouse Management/Fulfillment module will now become an add-on module to a number of EFI's existing ERP/MIS products. EFI’s existing MIS portfolio includes Monarch, Pace, PrintSmith and Radius. EFI will continue to support PrintStream installations but will not sell the technology as a standalone MIS product.

“While PrintStream is the first product we have acquired as part of our new consolidation strategy, we will be actively seeking out additional Print ERP/MIS solutions world-wide to consolidate,” said Marc Olin, GM of EFI APPS.

EFI’s annual Connect user conference, with a significant amount of focus placed on the MIS segment, takes place April 26 to 29 at Wynn Las Vegas.

After emerging from bankruptcy protection in mid-December 2010, AbitibiBowater, one of the world’s largest newsprint manufacturers, has reached a binding agreement to sell its 75 percent interest in ACH Limited Partnership. As part of the transaction, the Caisse de dépôt et placement du Québec has also agreed to sell its 25 percent interest in ACH.

The agreement values ACH’s hydro assets, which have a combined capacity of approximately 131 MW, at approximately $640 million.

The sale, to a consortium formed by a major Canadian institutional investor and a private Canadian renewable energy company, is expected to generation around $300 million for AbitibiBowater. Most of the proceeds will be used to pay down company debt.

“We are looking forward to the completion of this transaction. Our intention is to immediately apply $100 million of the proceeds from this sale to reduce company debt,” stated Richard Garneau, President and Chief Executive Officer of AbitibiBowater. “We intend to protect the cost structure of the Iroquois Falls and Fort Frances mills and remain committed to reducing costs.”

RockTenn and Smurfit-Stone announced last week that it has reached an agreement which will see Georgia-based RockTenn acquire Smurfit-Stone Container Corp. The value of the transaction is approximately US$3.5 billion.

"RockTenn's acquisition of Smurfit-Stone is another major step in our transformation of RockTenn to be the most respected company in our business with a laser focus on exceeding our customers' expectations and creating long term shareholder value," said RockTenn's Chairman and Chief Executive Officer, James A. Rubright in a statement. "The containerboard and corrugated packaging industry is a very good business and U.S. virgin containerboard is a highly strategic global asset. With this acquisition, RockTenn's fiber input ratio will be 55 percent virgin and 45 percent recycled. We believe this transaction provides the greatest possible career opportunities for our co-workers from both companies."

RockTenn was founded in 1936 and employs over 10,000 people in 90 facilities across five countries, including Canada. This new acquisition will make the company the number two producer of containerboard in North America and the number two producer of coated recycled board.

As previously announced in September 2010, manroland AG has begun management changes inline with its corporate growth strategy. This includes merging its Small Newspaper Presses business unit (located in Plauen, Germany) with the Large Newspaper Presses business unit (in Augsburg) to form a Newspaper Printing Systems business unit under a single management structure.

Georg Riescher, former Executive VP of the Small Newspaper Presses unit, assumes leadership of the new combined unit. Anton Hamm, who previously headed up the Large Newspaper Presses unit, has been named as the Executive VP of manroland’s Technology Center for Webfed Printing Systems. The Technology Center combines training, engineering for testing and processes, as well as the implementation of new products. 

Back in September 2010, manroland and its investors, Allianz Capital Partners, announced new measures aimed at long-term success for the company. “We are convinced that manroland must seize these opportunities as a company on a stand-alone basis,” explained Gerd Finkbeiner, CEO of manroland, in September. “To remain successful in the long run, manroland must make adjustments to its structures and processes. As a result, the three German production sites will be assigned clear core competencies. In addition, the main focus is firmly on growth markets and the services sector.”

manroland released the following three main points about its restructuring and long-term strategy:

1. An unchanged basic structure: manroland will continue to build systems for sheetfed printing and web offset printing at three sites. Each of the three sites will be assigned a specific core competence:

      • In the future, the sites in Augsburg (web offset presses) and Offenbach (sheetfed presses) will concentrate exclusively on manufacturing complex parts and assembly,

     • The Plauen site will become the business sector for industrial production. As a competence center for mechanical production and module assembly, the Plauen plant will manufacture products for manroland and other customers.

2. Integration of the business activities for the sheetfed and web offset sector:

     • Consolidation of the business units for small newspaper presses (until now at the Plauen site) and large newspaper presses at the Augsburg site,

     • Centralization of electronic activities,
     • The foundry in Offenbach will provide both business sectors with cast parts,

     • Concentration of the central functions for the Group at the Augsburg site.

3. Establishment of a new Technical and Industrial Services business sector consisting of about 300 employees who will focus on the following activities:

     • Industrial consultation,

     • Subcontracting of highly qualified technical experts.

Carsten Knudsen, CEO of EskoArtwork, announced that U.S.-based Danaher signed a Share Purchase Agreement for 100 percent ownership of EskoArtwork – a deal worth approximately €350 million.

EskoArtwork’s current shareholder, Axcel, a Danish investment group, expects the transaction to be concluded within the first half of 2011.

“We have been extremely satisfied with our investment in EskoArtwork,” said Sigurd Lilienfeldt, Partner at Axcel and responsible for the investment in EskoArtwork. "During Axcel's ownership, EskoArtwork has repositioned itself into a world-leading company within its field. This is not only due to the merger with Artwork Systems, but also because of significant R&D investments leading to a range of new leading-edge solutions. This innovation capacity of EskoArtwork has been instrumental for the impressive EBITDA growth during our ownership leading to this very successful exit for Axcel.”

Danaher, which trades on the New York Stock Exchange, is described as a diversified technology company that designs, manufactures, and markets products and services to professional, medical, industrial and commercial customers. The company and its 47,000 employees generated US$11.2 billion of revenue in 2009.

Upon closing, EskoArtwork will become a part of Danaher's Product Identification platform. EskoArtwork employs around 1,050 people worldwide and generated €184.1 million in revenues in 2010.

“This is an important and very positive step in the continued development of the company,” said Carsten Knudsen, CEO of EskoArtwork. “I and the entire management team are excited to see Danaher's strategic interest to acquire the company and develop EskoArtwork as an autonomous business. We see this as a vote of confidence in our strategy and a strong belief in our ability to continue to grow in the future.”

MeadWestvaco Corp. has agreed to sell its Envelope Products Group to Stamford-based Cenveo Inc. Terms of the agreement were not disclosed, while the deal is expected to close by the end of 2010.

“Cenveo is focused on expanding its envelope platform, and adding the Envelope Products Group underscores our continued strategic growth plan for the business,” stated Robert Burton Sr., Chairman and CEO of Cenveo. The Envelope Products Group has approximately 910 employees in the United States.

In other news, Cenveo has acquired Impaxx Inc., the owner of Gilbreth Packaging Solutions, from affiliates of Aurora Capital Group, a Los Angeles private equity firm. Gilbreth operates a facility located in Croydon, Pennsylvania, and has approximately 75 employees.

Gilbreth is described as a full-service manufacturer and marketer of full-body shrink sleeves, tamper-evident neck bands and medical and electronic tubing.

Burton stated: “The acquisition of Gilbreth expands our specialty packaging into the growing shrink sleeve market. Gilbreth's product line complements Cenveo's existing offerings and will create immediate cross-selling opportunities for both companies' customers.”

Eastman Kodak has announced it will be acquiring substantially all of the assets of the relief plates business of Tokyo Ohka Kogyo Company (TOK). The acquisition will expand Kodak's capabilities, particularly in the packaging industry.

The relief plate business includes flexography, letterpress, Braille and molding plate products produced and marketed by TOK worldwide. Included in the acquisition agreement is a manufacturing plant located in Yamanashi Prefecture, west of Tokyo, that produces relief plates.

“Kodak is strongly committed to the packaging industry and we are seeing growing demand, especially in the Asia-Pacific region. We are delighted by this opportunity to add TOK’s talented employees to our existing team for the benefit of our customers and shareholders,” said Douglas Edwards, Kodak Vice President and General Manager, Prepress Solutions. “Delivering solutions for the packaging industry is one of Kodak’s key corporate growth initiatives, and we expect to double revenues in this segment by 2012, so this will contribute toward that goal.”

Approximately 100 employees part of TOK's relief plate business will join Kodak after the completion of the acquisition, expected to close in the first quarter of 2011. Financial terms of the deal have not been disclosed.

After announcing the purchase of an Agfa :M-Press in April of this year, Scarborough-based Cameron Advertising Displays has now acquired Schawk Cactus Imaging.

“Our company is uniquely positioned to provide a comprehensive range of both analogue and digital print solutions such as retail signage, fleet graphics, billboards, banners, packing, fulfilment, etc., for a broad range of new and existing customers around the world,” stated Bob Deveau, President of Cameron Advertising, on news of the Cactus Imaging purchase.

Cameron Advertising currently runs two facilities, including a 30,000-square-foot space that houses a 5-colour IST Inline UV screen press, as well as a 12,000-square-foot facility geared toward large-format inkjet production. In addition to the :M-Press, the company also lists the following machines in use for large-format production: VUTEk QS 32000 flatbed, VUTEk 3360 roll to roll, 72-inch Mimaki fabric printer, and an HP 5500.

“Customers in the print industry are increasingly looking for partners who can deliver a complete, national solution," stated Greg Donais, who was recently appointed as VP for Cameron Advertising. “We are now better positioned than any other supplier to deliver on this promise.”

Cameron Advertising, with over 60 staff today, has served the screen-printing needs of the Greater Toronto Area for more than 60 years, while Cactus Imaging has been in business for 18 years.

Read April 2010 article: Cameron Advertising Purchases :M-Press

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