Mergers & Acquisitions

Transcontinental Inc. of Montreal announced that it is selling its Toronto- and Montreal-based consumer magazines and associated Websites, as well as all related platforms, to TVA Group for $55.5 million. The transaction is subject to approval by regulators, including Canada’s Competition Bureau.

The move is to effect some 310 people at Transcontinental’s TC Media division.

TVA Inc. is a Montreal-based communications company with operations in broadcasting, publishing and production. Quebecor Media, owned by Quebecor Inc.. holds voting control of the company with the near-complete ownership of TVA Group's Class A shares.

In June 2014, Transcontinental purchased a majority of Quebecor Media’s newspaper assets operated by Sun Media in a $75 million deal.

 

As part of this new magazine transaction, Transcontinental also signed a parallel agreement with TVA Group to print the purchased consumer magazines and TVA’s marketing products for a period of seven years, and to extend the contracts signed in December 2013 to print certain TVA Group magazines to the end of June 2022.

“Today's agreement creates twofold value for Transcontinental Inc.,” stated Francois Olivier, President and CEO of Transcontinental. “In one stroke we have also improved the book of business for our printing sector.”

Olivier also shared his views of the magazine sector in relation to TVA’s purchase: “In the context of the highly competitive magazine industry that is experiencing a proliferation of platforms and generated content as well as migration of advertising revenues towards digital media, Transcontinental Inc. has decided to sell its consumer magazines produced in Montreal and Toronto to TVA Group whose platforms will enable the continued evolution of these magazines.”

Some of the higher profile magazine properties involved in this transaction include: Coup de pouce; Elle Quebec; Decormag; Le Bel Age Magazine; Magazine Vero; recettes.qc.ca; Canadian Living; Style at Home; Elle Canada; Good Times; and The Hockey News. The magazines Vancouver Magazine and Western Living, distributed in Western Canada, remain the property of TC Media.

“Furthermore, Transcontinental Inc. has decided to now focus on the local advertising market, which offers us more business opportunities through our 180-odd newspapers in Quebec, Ontario, Saskatchewan and the Atlantic provinces,” said Olivier. “This important phase in the evolution of the corporation also gives TC Media full latitude to further develop its digital and interactive marketing products for retailers, among others, and to advance the production and delivery of content in the fields of business and education.”


Langley Holdings plc of the United Kingdom moved to acquire DruckChemie, a German print chemicals group that went into administration in September.

Contracts were signed on November 7 and the deal was awaiting cartel clearance. In its most-recent fiscal year, DruckChemie had annual revenues of €75 million and around 300 employees, with locations throughout Europe and also operations in Brazil.

“We are delighted to have reached agreement to acquire DruckChemie, the company compliments our Manroland press business and further demonstrates our commitment to the sector,” a spokesman for Langley stated.

Langley entered the print sector in January 2012 with the acquisition of the German press builder Manroland Sheetfed. Langley, primarily through acquisitions of under-performing businesses over the last two decades, has evolved into a near billion euros revenue group employing over 4,000 people in over 70 countries. Langley states it is entirely debt free and prides itself on having never sold any company it has acquired.

The PDI Group of Kirkland, Quebec, commits to a new printing sector by acquiring one of the province’s best know wide-format operations, Trans-Optique based in Montreal’s area of Pointe-Claire.

The sale of Trans-Optique comes as its President, Joe Taddeo, is transitioning into retirement. In addition to producing traditional large-format work, Trans-Optique is recognized for its work in the field of very large format printing, as well as installation, which further enables PDI to diversify and expand its services.

PDI states the addition of very wide format printing is a natural complement to its existing prepress, offset and digital printing, direct mail, as well as fulfillment and distribution services.

“PDI’s customer-centric corporate culture aims to help our clients get their message to market with high quality and consistent visuals,” said Jamie Barbieri, President of PDI Inc. “With our new oversize wide-format capability, we are adding yet another key component to our service offering, further demonstrating our commitment to providing customers with truly integrated print solutions.”

Trans-Optique positions itself as a one-stop shop for large-format work with services like production on silkscreen, offset, digital, paint jet, inkjet and self-adhesive lettering. PDI Inc. describes itself as the largest independent sheetfed printing company in Quebec, providing premedia, offset and digital print production, Web-to-print, as well as fulfillment, warehousing and direct-mail services to clients in Quebec, across the rest of Canada, and in the United States.

“I have been working in this industry for 35 years, and with the Trans-Optique employees since 1988 to build this company into the market leader that it is today,” says Joe Taddeo, President of Trans-Optique. “As I will be retiring, it was important to me to ensure that Trans-Optique and its employees were in good hands, to continue both to serve our clientele and to grow the business. I am confident that the PDI team is up to the task.”

Avant Imaging & Information Management Inc. (AIIM) of Aurora, Ontario, has acquired the assets of the Aurora print facility of Ricoh Document Management (RDM).

The purchase of RDM’s Aurora facility will expand AIIM’s existing capabilities in document management and direct-mail services. “The combination of this facility with our current services will widen our offering to our clients enabling us to provide new services and strengthen those that we currently deliver,” said Mario Giorgio, CEO of AIIM. “We look forward to bringing together the two operations to deliver the most comprehensive suite of document management services available.”

Frank Giorgio, President of AIIM, also known as The AIIM Group, explains the acquisition will result in greater efficiencies and significantly increase AIIM’s market share in direct-mail services. AIIM states it has developed 10 service lines based on the enterprise output chain.

The AIIM Group operates within an 80,000-square-foot facility with 90 full-time employees. The Aurora company’s services blend includes litho, high-speed inkjet and toner printing, as well as online developments and data services.

A month after selling 74 Quebec weekly newspapers, Quebecor today signed a $316 million deal to also sell its English-language publishing operations, controlled by Sun Media, to Postmedia Network Canada Corp., led by President and CEO Paul Godfrey.

Subject to approval by Canada’s Competition Bureau, Postmedia is to acquire Sun Media’s 175 newspapers and publications, including the Sun chain of dailies (Toronto Sun, Winnipeg Sun, Edmonton Sun and Calgary Sun), as well as The London Free Press, the 24 Hours dailies in Toronto and Vancouver, and community dailies and weeklies, buyers’ guides and specialty publications.

The transaction also includes the Canoe portal in English Canada, part of the national sales team based in Toronto and Quebecor’s Islington, Ontario, printing plant. The $316-million purchase price is payable in cash, subject to the customary adjustments and to a $10 million adjustment, related primarily to real estate properties.

"Consumers now have many ways to get their news, and as a result the newspaper business has faced increasing competition from digital media and new technological platforms. Newspaper revenues have been declining year by year," stated Pierre Dion, President and CEO of Quebecor and Quebecor Media.

"This transaction therefore comes at a time when the Canadian newspaper business absolutely needs consolidation to remain viable and to compete with digital media," continued Dion. "The transaction will also keep Sun Media Corporation’s properties in the hands of a well-established Canadian group."

At the beginning of September 2014, Quebecor finalized its sale of 74 Quebec-based weeklies to Transcontinental for approximately $75 million. As a result of acquiring Sun Media’s 74 weeklies, Transcontinental, from its complete portfolio, sold 14 titles and planned to stop publishing another 20.

Goldman Sachs Merchant Banking Division and Koch Equity Development LLC have completed their acquisition of Flint Group from funds managed by CVC Capital Partners.

The deal was first announced in mid-April 2014, when Matthias Hieber, Head of Corporate Equity Investing for Goldman Sachs Merchant Banking Division, commented: “We believe Flint Group is uniquely positioned to capture growth in its attractive printed packaging markets while at the same time continuing to benefit from strong and resilient performance of its print media business.”

Flint Group is a global supplier of inks and other print consumables such as flexographic printing plates, blankets, image transfer products and chemicals for pressrooms. It controls 137 sites in 40 countries and employs around 6,600 people, which generated revenues of €2.2 billion (US$2.9 billion) in 2013.

“This is a great day for Flint Group employees, our customers and our suppliers,” stated Antoine Fady, CEO of Flint Group. “Following the acquisition by our new shareholders, Flint Group now goes forward with a much stronger capital structure and additional flexibility.”

TC Transcontinental Inc. on September 3 announced it has shutdown 20 weekly newspapers following the $75 million acquisition of 74 weeklies in Quebec from Sun Media Corporation.

After the newspaper deal was first announced in December 2013, Canada’s Competition Bureau set a requirement for Transcontinental to put 33 of 154 newspapers in its full portfolio up for sale for a period of 60 days, including some that were part of the transaction with Sun Media. This process began on June 1, 2014, when the acquisition was finalized.

On September 3, Transcontinental reported that out of the 33 newspapers put up for sale, 14 have found buyers. Of that number, three will continue to be published as weekly newspapers and 11 will now be published online only.

As a result of finalizing the Sun Media deal, and meeting the requirements set out by Canada’s Competition Bureau, Transcontinental plans to stop publishing 20 of its titles. The company states, for the most part, these properties are to be integrated with other publications it holds in the same regions. The reorganization is expected to eliminate approximately 80 jobs.

Le Journal de Saint-Hubert (Saint-Hubert) and Le Rive-Sud Express (Longueuil) have been bought by Les MÉDIAS de la Rive-Sud, and L'Écho du Nord (Saint-Jérôme) has been purchased by Éditions Blainville Deux-Montagnes.

The publishing company Néomédia is buying the following papers and plans to publish them online only: Agri-Vallée (Valleyfield), Chambly Express (Chambly), Le Journal de Joliette (Joliette), Le Point du Lac-Saint-Jean (Saint-Félicien), Le Réveil (Saguenay), L'Écho de la Rive-Nord (Sainte-Thérèse), L'Écho de Laval (Laval), L'Écho de Trois-Rivières (Trois-Rivières), Pub Extra Magazine (Laval-Laurentides), Sorel-Tracy Express (Sorel-Tracy) and Vallée-du-Richelieu Express (Mont-Saint-Hilaire).

RP Graphics Group Ltd. and Rhino Print Solutions Inc. have formed what the companies describe as a "strategic alliance designed to deliver coast to coast print solutions."

The alliance between the two companies results in RP Graphics agreeing to acquire and integrate Rhino's Toronto operations effective September 22, 2014. Rhino’s Toronto facility, formerly Marcam Cross Media Limited, provides print-on-demand and services for multi-channel communications.

“This alliance is a significant step for both of our companies and great news for our customers,” stated David Allan, President and CEO of Rhino. “Our newly combined technology platform and geographic reach through modern facilities in Vancouver, Calgary and Toronto will allow us to provide an efficient and seamless service offering across Canada.”

RP Graphics, located in Mississauga, Ontario, has a staff of over 140 employees, operating out of two production facilities. Its CEO, George Mazzaferro, was named Printing Leader of the Year by PrintAction magazine in 2013 (featured in PrintAction's February 2014 issue).

“This alliance is about meeting client needs and doing it better and faster," stated Mazzaferro. “As we grow, more and more of our clients are national in scope… David and I have been friendly competitors for some time and we share a common vision when it comes to print services; it's all about meeting client needs.”

Rhino Print Solutions is a privately held company based in Vancouver, BC. The company is a perennial award winner with manufacturing plants in Vancouver and Calgary, Alberta.

Mark Andy has been sold by American Industrial Partners to a new investment group formed by P.J. Desai, who is Mark Andy's former CEO, and the current management team.

American Industrial Partners continues as a minority investor in Mark Andy along with Graycliff Partners. Mark Andy, which develops presses and related technologies for the packaging industry, primarily flexography, is based in Chesterfield, Missouri, just outside of St. Louis.

"This was an outstanding opportunity to purchase an established and innovative company with a strong core business of equipment, consumable products and services for the label market, as well as several exciting new products in the pipeline, including our new digital series inkjet press," stated Desai. "Combined, there are over 10,000 Mark Andy and Rotoflex machines currently installed with a replacement value of over $1 billion."

Desai served as Mark Andy's CEO from 2012 to 2014. Prior to that, he was President and CEO of Abencs, an engineering and construction company, and MECS Inc., focused on the design of sulfuric acid plants and related products. Mark Andy is currently led by CEO Kevin Wilken.

CCL Industries Inc. of Toronto, a global manufacturer of printed label and packaging products, signed a binding agreement to acquire Bandfix AG located near Zurich, Switzerland.

Bandfix is a privately owned label company focused on European specialty customers with estimated sales for the calendar year of 2014 of $47 million and anticipated adjusted EBITDA of approximately $3.5 million. The agreed debt and cash free enterprise value is $18 million.

“Bandfix has a long history in the European label industry and brings to CCL a foothold in Switzerland, home to the headquarters of many important global customers, especially in the healthcare and specialty space,” stated Geoffrey Martin President & CEO of CCL Industries. “We are pleased to welcome Bandfix employees to CCL and have solid plans to invest in Switzerland to develop the business for future growth and improved profitability.”

Bandfix, which is to be renamed as CCL Label upon meeting customary closing adjustments, will be overseen by Austrian-based Guenther Birkner, President of CCL’s Food & Beverage business.

CCL Industries operates three divisions, Label, Container and Tube, with 6,600 employees in over 70 operations on six continents.



Investcorp, a global equity firm based in London, UK, reached an agreement to acquire SPGPrints Group B.V. from funds managed by Bencis Capital Partners for an enterprise value of €240 million. The transaction’s closing must first be approved by appropriate competition authorities.

Established in 1947, SPGPrints is a global provider of technologies for rotary screen and digital printing of textiles and graphic applications, as well as a manufacturer of precision metal components for a range of applications. Headquartered in Boxmeer, The Netherlands, SPGPrints is represented in more than 100 countries and in 2013 generated revenue of €214 million.

“We have followed SPGPrints for a long time and were attracted by its differentiated, global rotary screen business, its innovative digital inks activities, attractive precision metals offering and entrepreneurial management team,” stated Carsten Hagenbucher, a Principal in Investcorp’s corporate investment team in London.

Investcorp also recently purchased Paper Source of the United States.

“There are many parallels to other portfolio companies in which we have invested and we look forward to applying such knowledge to SPGPrints,” continued Hagenbucher, “particularly with respect to digital inks.”

Cascades Inc. plans to cease its Kraft paper manufacturing activities in the East Angus, Quebec, on October 3, 2014. This move follows Cascades Inc.’s recent sale of Cascades Fine Papers Group to H.I.G. Capital of Miami, who were joined in the purchase by some of the fine paper operation’s management team.

Close to 175 employees will be affected by the East Angus Kraft closure, which is another step toward Cascades earlier indication that it plans to completely withdraw from the Kraft paper sector.

Cascades, in its East Angus shutdown announcement, points to unfavorable market conditions in the sector, including new competitors that can convert newsprint paper machines to produce Kraft paper, and the failure of being able to sell the paper facility.

News of the Kraft mill shutdown does not concern Cascades’ coated boxboard manufacturing plant also located in East Angus, which is Quebec’s Eastern Townships about 20 kilometres east of Sherbrooke.

Grimco Inc. of St. Louis, Missouri, acquires the Canadian operations of Proveer Sign and Graphics, a distributor of supplies and equipment with five locations across the country.

Grimco previously purchased the United States-based operations of Proveer Sign and Graphics in May 2012. In Canada, Grimco adds locations in Toronto, ON, Montreal, QC, Dartmouth, NS, Calgary, AB, and Vancouver, BC.

Michael Bolinger, from Grimco is to lead the merger process as the Vice-President of Canadian Operations.

“Proveer Sign and Graphics’ experienced management team has done a fantastic job of building a solid and successful organization that provides superior products and services to its customers throughout Canada,” stated John Burkemper, President of Grimco Inc. “This acquisition provides Grimco Inc. the opportunity to expand into new markets and market an extensive product portfolio.”

Grimco currently has 40 locations throughout the United States.

H.I.G. Capital of Miami purchased Cascades Fine Papers Group, owned by Cascades Inc. The resulting company, which includes investment from the current management team, is to be re-named Rolland Enterprises, resembling a prior identity for the historic paper maker headquartered in Saint-Jérôme, Quebec.

Rolland’s facilities include the paper mill and converting centre in Saint-Jérôme, as well as a deinking plant in Breakeyville, Quebec.

Based on the existing market focus of Cascades Fine Papers Group (CFPG), the new Rolland entity takes on the production of fine papers using recycled fibers, which are noted for holding amongst the highest environmental standards in the paper industry. This includes papers with up to 100 percent post-consumer waste content for customers in commercial, B2B, government and education segments. CFPG also holds a historic position in the production of security papers, including papers used in passports, visas, tax stamps and cheques.
 
“The company is the industry leader with a long track record of producing innovative, high-quality products and the highest level of environmental sustainability,” stated Ricky Stokes, Managing Director of H.I.G. Capital. “We are pleased to support the team in their growth and continued success.”

While much of the current CFPG leadership remains intact, Philip Rundle joins the executive team as CEO to focus on the sales and marketing efforts. Rundle’s experience in the pulp and paper industry includes roles as CEO of North American Operations for Mercury Paper/Oasis Brands, as well as Vice-President of North America & Europe Brand Development at Kimberly Clark. He most recently served as CEO of Green Innovations Ltd in Washington, since April 2013.

Key executives staying on with Rolland include Pierre Guay, Richard Laramée and Marc Charbonneau, who continue to be responsible for their respective facilities. Normand Champagne will be Vice President of Sales and Marketing and Guy Beaudin Vice-President of Administration.

“This transaction provides stability and growth opportunities for all Rolland employees, customers and suppliers,” stated Daniel Parrot, President and COO of Rolland Enterprises. “We are excited about the future of the business and the partnership with H.I.G.”

H.I.G. is a global private equity investment firm with more than $15 billion of equity capital under management. Based in Miami, and with offices in Atlanta, Boston, Chicago, Dallas, New York and San Francisco in the U.S., as well as international affiliate offices in London, Hamburg, Madrid, Milan, Paris and Rio de Janeiro, H.I.G. specializes in providing capital to small- and medium-sized companies.

Since its founding in 1993, H.I.G. has invested in and managed more than 200 companies worldwide. The firm's current portfolio includes more than 80 companies with combined sales in excess of $30 billion.

The C.J. Group of Companies of Toronto has acquired Artwords Inc., which specializes in services for the retail sector.

Artwords was established in 1984 as a typesetting and assembly studio. Today, the company provides graphic production, proofreading, short-run printing, large-format printing, installation, kitting and packaging, as well as logistics and distribution services.

“This partnership is a great fit for our ever-expanding group of companies and will greatly help service and expand our retail division moving forward,” stated Jay Mandarino, President and CEO of the C.J. Group of Companies, which includes C.J. Graphics, Printers & Lithographers.

Dino Narsai is to remain as President of Artwords, which provides C.J. Graphics with a central Toronto location, as well as additional large-format inkjet and digital printing assets. “Dino’s company has been around for more than 25 years and he and his team are experts in the retail space, including in-store installations and execution,” stated Mandarino.

Mandarino indicated two more acquisitions by C.J. Group are planned before the end of the calendar year.

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