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.
TC Transcontinental Inc., through its TC Media operation, finalized its approximate $75 million agreement to acquire the 74 weekly newspapers of Sun Media in Quebec, as well as their related Web properties. Transcontinental now owns all the weekly newspapers acquired from Sun Media, which is controled by Quebecor through its Quebecor Media group.
After the deal was first announced in December 2013, Canada’s Competition Bureau set a requirement for Transcontinental to put 34 of the 154 newspapers in its portfolio up for sale for a period of 60 days, including some that are part of the transaction with Sun Media.
At the time of the acquisition announcement, Francois Olivier, President and CEO of Transcontinental, stated: “Acquiring Sun Media’s 74 community papers in Quebec is in line with our strategy to strengthen the core assets of TC Media and develop a local digital media offering for businesses and communities… This transaction will add approximately $20 million to TC Transcontinental's operating income before amortization.”
TC Transcontinental has more than 9,000 employees in Canada and the United States, generating revenues of $2.1 billion in 2013.
Veritiv is to be the name for a new publicly traded distribution giant once the merger between xpedx, a business of International Paper, and Unisource Worldwide, complete their merger first announced in January 2014.
The name Veritiv, according to the companies, comes from the roots of three words: Verity, Active and Connective. Common stock of the new company is expected to trade on the New York Stock Exchange under the symbol VRTV.
“Veritiv will meet and exceed our customers’ expectations by providing them with the end-to-end print, packaging, facility and logistic solutions they need to make their key business operations more efficient and more sustainable,” stated Mary Laschinger, who will serve as Veritiv’s chairman and CEO.
The company will begin operating under the name Veritiv and will introduce its new branding and logo immediately after the closing of the transaction, which is expected to occur early in the third quarter of 2014.
Upon completion of the merger, which is being facilitated through a Reverse Morris Trust structure, the new company will have projected annual revenues in the range of $9 billion to $10 billion and will have approximately 9,500 employees across more than 170 distribution centers in North America. The combination is expected to generate approximately $150 million to $225 million in annual net synergies.
Konica Minolta Business Solutions moves deeper into enterprise content management (ECM) with the purchase of AMS Imaging located in Rhode Island.
This is the second ECM company acquired by Konica Minolta, after its January 2013 purchase of DocuSource. “The acquisition of AMS Imaging expands Konica Minolta’s existing ECM practice with the addition of highly skilled solutions analysts, solutions engineers and imaging staff with extensive industry knowledge and expertise to support our customers,” stated Sam Errigo, SVP, Business Intelligence Services, Konica Minolta Business Solutions U.S.A.
AMS Imaging was established in 1971, and provides what the company describes as end-to-end ECM solutions including consulting services, software, digital scanning equipment, and production scanning services.
“We are excited to combine AMS Imaging’s extensive sales and support capabilities with the breadth of Konica Minolta’s offerings,” stated James McKenney, CEO AMS Imaging. “With this move, our newly combined teams will be able to leverage shared and proven best practices and resources to expand our ECM business while providing the highest levels of support for our customers.”
Goldman Sachs Merchant Banking Division has partnered with Koch Equity Development LLC, a subsidiary of Koch Industries Inc., to acquire shares representing 100% of Flint Group’s share capital, which is currently in the form of funds controlled by private equity firm CVC Capital Partners.
Koch Equity Development has agreed to invest with Goldman Sachs in a newly formed entity that will acquire Flint Group. “The management team of Flint Group is excited about this planned new ownership, and the opportunities this now presents,” stated Antoine Fady, CEO of Flint Group. “The investment by Goldman Sachs Merchant Banking and Koch is a clear vote of confidence in our vision, strategic plans, and can-do culture.”
Flint Group, a global supplier of inks and other print consumables such as flexographic printing plates, blankets, image transfer products and chemicals for press rooms, is described as the number one or number two supplier in most of the market segments it serves. Flint Group operates 137 sites in 40 countries and employs some 6,600 people.
“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,” stated Matthias Hieber, Head of Corporate Equity Investing in the German Speaking Region of Goldman Sachs Merchant Banking Division. “With a significantly improved capital structure, Flint Group is best positioned to pursue its ambitious growth plans to further strengthen its market leading positions.”
This sale remains subject to customary closing conditions and should be completed by the second half of 2014.
Quad/Graphics Inc., one of the largest printing companies in North America, signed an agreement to acquire Brown Printing for approximately $100 million.
Brown Printing, with three manufacturing facilities in Waseca (MN), Woodstock (IL), and East Greenville (PA), primarily provides printing and distribution services for publishers and catalogers. Brown Printing is wholly owned by Gruner + Jahr of Hamburg, Germany, a member of the Bertelsmann Media Worldwide family of companies, which also owns RTL Group, Random House and Arvato.
The transaction is subject to customary regulatory clearances and is expected to close in the second half of 2014. Both Quad/Graphics’ board of directors and Brown’s parent company Gruner + Jahr and its shareholders have approved the transaction.
“This acquisition will enhance the many ways we help publishers and marketers drive top-line revenues while better controlling their overall total cost of production and distribution,” stated Joel Quadracci, Quad/Graphics Chairman, President & CEO. “With print as our foundation, we will continue to find innovative ways to connect and integrate print with other media channels to increase reach, response and return on investment.”
Brown expects to generate approximately $350 million in revenues during fiscal year 2014.
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