Sunday, September 7, 2014

August 2014 –Mergers, Acquisitions & Restructuring in the Printing, Packaging & Related Industries

Mailing and fulfillment service companies are aggressively moving upstream into printing, graphic design and data management services. Streamworks, in Arden Hills, Minnesota, jumped up the value ladder and acquired Imagewërks Marketing, a design and production boutique, also located in Arden Hills. The acquired company had itself evolved over three decades from a printing company into a “comprehensive marketing company.” The buyer, Streamworks, also has been a work-in-progress, having been formed just last year when Action, a direct mail and fulfillment company, joined with Expedite Direct Mail & Fulfillment, a provider of printing and direct mail services. The newly combined entities will still provide printing services, and promote ink-on-paper as an effective communication channel; print services are subsumed under the broad message that the company provides “integrated marketing communications.”

Com-Pak Services, a Moorestown, New Jersey provider of mailing services, has teamed up with EU Services in Rockville, Maryland under the ownership of private equity fund Maidstone Capital. The two operating companies, now under combined management, will provide single-source direct marketing services. With this addition to the Maidstone portfolio, Com-Pak, formerly at the tail-end of the direct mail process, moves upstream into the printing segment with sheetfed and web press capability, digital printing and data processing. EU Services had also moved up-market over time, morphing from an envelope printing company into a data-driven digital printing company.  

The YGS Group, a York, Pennsylvania company offering marketing, publishing and printing services, expanded to the west coast with its acquisition of Print Management, located in the Seattle metro area.* The YGS Group has developed a suite of diversified and integrated services that includes design, copywriting, social media implementation, event management and print advertising sales. The company has announced plans to roll out these services to its new location, in addition to the acquired printing and fulfillment capabilities.

Performance Printing in Dallas, Texas enhanced its Performance POP division with the acquisition of Miramar Designs, a Fort Worth company that specializes in the design of in-store displays. Offering a variety of specialized printing techniques, including lenticular printing, personalized plastic card printing as well as point-of-purchase displays, the company now offers creative design services.

Rock-Tenn, a $9.8 billion company which produces containerboard and paperboard in its own mills, is also a major printing company in the packaging and display segments. RockTenn acquired the AGI In-Store company from American Greetings, producer of greeting cards. Located in Forest City, North Carolina, the acquisition brings additional design capabilities to RockTenn, along with manufacturing capabilities that include metal, wood and plastic fabrication. The operation has been bolted onto the company’s impressive vertically integrated merchandizing display operations. This is RockTenn’s second acquisition this year in the merchandizing display segment, following their acquisition in January of NPG in Chattanooga, Tennessee.

The churn and turbulence in the newspaper business that we reported on last month continued in August. The Tribune Company completed its spinoff of its newspaper publishing business. Gannett made its own split official in August, and announced that it will be joining virtually all the major multi-media companies as they jettison their print-centric business units. In the minor leagues, however, the opposite is true as acquisitions of regional and community newspapers continued unabated. Metro US, a daily paper in Philadelphia, acquired City Paper, a weekly paper that serves the same market. Adams Publishing Group, headquartered in Minneapolis, MN, continued its roll-up of community newspapers with the acquisition of Chronotype Publishing in Rice Lake, Wisconsin. (See The Target Report for July and March for Adam’s prior transactions this year). In stark contrast to the major metro newspapers, Adams is adding printed products to its holdings of radio stations, magazines, outdoor advertising and commercial printing.

As a sign of the improving economy and reported stabilization of the printing industry, for the first time in the three years that I have been publishing The Target Report, my research did not turn up any bankruptcies filed during the prior month in the printing, packaging, paper or related industries.


* Mark Hahn, the author of the Target Report and Senior Vice President of the NAPL Business Advisory Group, served as advisor to the seller in this transaction.


2014 August - Mergers and Acquisitions in the Printing, Packaging, Paper & Related Industries  

Deal Party #1
(Surviving Entity)
Pre-Deal
Revenues
($Mil )


Party #1 Address


Deal Party #2
Pre-Deal
Revenues
($Mil )


Party #2 Address
Date
Deal
Public
Deal
Value
($Mil)

Deal Structure
(Intermediary)


Notes

Press
Releases
Nanotech Security $2.1 Burnaby, BC Fortress Optical Features
(sub. Fortress Paper)
$2.3 Thruso, QC 8/26/14 $17.5 Acquisition Banknote security threads Link
Mark Andy Mngt Team No Data Chesterfield, MO Mark Andy
(American Industrial Partners)
No Data Chesterfield, MO 8/22/14 No Data Acquisition Flexo presses Link
YGS Group No Data York, PA Print Management No Data Tukwila, WA 8/21/14 No Data Acquisition
(NAPL, Advisory Group)
Commercial printing Link
Coveris $2,800 Chicago, IL Learoyd Packaging  $33.0 Burnley, UK 8/21/14 No Data Acquisition Flexographic printing Link
RockTenn $9,770 Norcross, GA A.G. Industries
(sub. American Greetings)
No Data Forest City, NC 8/21/14 No Data Acquisition POP & store displays Link
Streamworks No Data Arden Hills, MN Imagewërks Marketing No Data Arden Hills, MN 8/20/14 No Data Acquisition Marketing agency Link
Penske Media No Data Los Angeles, CA Fairchild Fashion Media
(Sub. Condé Nast)
No Data New York, NY 8/14/14 $100.0 Acquisition B-to-B Publications Link
Metro US No Data Philadelphia, PA City Paper No Data Philadelphia, PA 8/13/14 No Data Acquisition Weekly newspaper Link
Proforma 3rd Degree No Data Akron, OH Hyde Brothers Printing Co No Data Marietta, OH 8/13/14 No Data Acquisition Commercial printing Link
Keller Bros. & Miller No Data Buffalo, NY Petit Printing No Data Riverside, NY 8/8/14 No Data Acquisition Commercial printing Link
Charter Oak Equity No Data Westport, CT Seaboard Folding Box No Data Fitchburg MA 8/6/14 No Data Acquisition Folding cartons Link
Gannett $5,480 McLean, VA Publishing businesses No Data McLean, VA 8/5/14 No Data Spin-off National & local newspapers Link
Maidstone Capital No Data Westport, CT EU Services No Data Rockville, MD 8/5/14 No Data Acquisition Direct mail & printing Link
Vomela Specialty Company $230.0 St. Paul, MN Master Print No Data Newington, VA 8/4/14 No Data Acquisition Commercial printing Link
Gill Studios
(Re-branded Gill Bebco)
No Data Lenaxa, KS Barton Nelson No Data Kansas City, MO 8/4/14 No Data Acquisition Printed promotional products Link
Tribune Company $3,210 Chicago, IL Tribune Publishing No Data Chicago, IL 8/4/14 $528.0 Spin-off Metro newspapers Link
Adams Publishing Group No Data Minneapolis, MN Chronotype Publishing Co No Data Rice Lake, WI 8/1/14 No Data Acquisition Community newspapers Link
Perfomance POP No Data Dallas, TX Miramar Designs No Data Fort Worth, TX 8/1/14 No Data Acquisition Retail display design Link


2014 August - Bankruptcy Filings in the Printing, Packaging, Paper & Related Industries



Filing Party

Date
Case
Filed
Pre-Petition
Revenues
($Mil )



Case #



Filing Party Address



Circuit



Region & City



Judge



Attorney for Debtor



Notes
Chapter 11 Filings:
No Chapter 11 Filings Found this Month --- --- --- --- --- --- --- --- ---
Chapter 7 Filings:
No Chapter 7 Filings Found this Month --- --- --- --- --- --- --- --- ---


2014 August - Non-Bankruptcy Closures in the Printing, Packaging, Paper & Related Industries



Closed Company / Facility

Date of Closure
Pre-Closure
Revenues
($Mil )



Closing Address
Related Party Related Party
Address
Date Closure Public


Notes

Press
Releases
FIS - Printing & mailing facility Mar-15 No Data Brown Deer, WI Fidelity National Info Services Jacksonville, FL 8/28/14 Consolidating operations Link
FutureMark Alsip Sep-14 No Data Alsip, IL FutureMark Paper Group Westport, CT 8/21/14 Coated recycled paper mill Link
Old Town Fuel & Fiber 8/13/14 No Data Old Town, ME Patriarch Partners New York, NY 8/14/14 Pulp mill Link
Ennis - Knoxville Facility Sep-14 No Data Knoxville, TN Mutual Graphics Knoxville, TN 8/12/14 Consolidation into acquired plant Link

Friday, August 8, 2014

July 2014 –Mergers, Acquisitions & Restructuring in the Printing, Packaging & Related Industries

Forbes landed the big fish, achieving an estimated $475 million sale price, after much skepticism that the company could find a buyer that was willing to ante up the $400 million that the company was seeking. The buyer, a Hong Kong-based investor group improbably named Integrated Whale Media Investments, apparently wanted to make sure that this one did not get away. According to Forbes’ own projections that were prepared for prospective buyers and circulated earlier this year, the company estimated that revenues in 2013 would wrap up at $144.6 million with EBITDA of $20.8 million. If true, the reported purchase price represents a whopping multiple of 22.8 times cash flow and more than 325% of trailing revenues. Clearly the global cachet of the Forbes brand was the value driver in this deal, and the price is stunning in comparison to the paltry multiples paid for most publishing companies in recent years. Since the exact terms of the deal are private, maybe it’s all one big fish story…

The newspaper publishing business continues to roil as the major players divest their print-centric operations in favor of other media. E.W. Scripps Company in Cincinnati merged with Milwaukee-based Journal Communications to form a combined broadcasting group with TV and radio stations in 27 markets that reach 18 percent of US homes. The newspaper operations of the two companies were simultaneously jettisoned to form a new company, Journal Media Group, which will publish newspapers in 14 markets. This deal follows on the heels of last month’s spinoff of Time-Warner’s printed publications; last year’s split of Rupert Murdoch’s News Corp. from 21st Century Fox; the just completed spinoff of the Tribune’s newspapers; and the announcement days later that Gannett was splitting in two. The major urban dailies appear to be mere boat anchors holding back the value that can be harvested from media companies when the printed product is thrown overboard.

The smaller fish in the pond, regional newspapers, were actively regrouping and forming new schools of thought. Gatehouse Media purchased the Providence Journal from A.H. Belo, the publisher of two newspapers in Texas that paid handsomely several years ago to enter the New England market. Gatehouse media, which itself was restructured last year in bankruptcy and is now owned by New Media Investment Group, owns and publishes over 450 community publications. Adams Publishing Group, which acquired 34 titles in March, was back in the market, and purchased the assets of Huckle Media in Minnesota, adding 10 more community newspapers to its portfolio. NYC Community Media purchased the Community Newspaper Group which publishes 11 community and special interest newspapers that serve subsets of the larger New York City market. In upstate New York, publisher and printer The Scotsman Media Group, which had announced a management buyout in January, was unable to secure financing and closed its printing operations in two locations.

As we noted earlier this year, consolidation and change continues to affect the business of printing and mailing transactional documents. OSG Billing Services, headquartered in New Jersey, purchased SouthData in Mount Airy, South Carolina. Cathedral Corp in Rome, New York acquired transactional printer AXIS Data Solutions located in Orlando, Florida. In response the same factors driving this trend towards consolidation among transactional printers, Fidelity Investments, the huge financial services company, announced it is closing its own printing and mailing operations in Kentucky and Texas.

Private equity is playing a significant role in the ongoing reduction and rationalization of capacity in the paper manufacturing industry. Peak Rock Capital’s portfolio company, Atlas Paper Mills, acquired a source of recycled fiber for its paper, Accurate Paper Recycling, located in Tampa, Florida. FiberMark, a portfolio company of American Securities, acquired Crocker Technical Papers in Fitchburg, Massachusetts. H.I.G Capital backed a management buyout of Cascades Fine Papers Group, and is bringing back the Rolland brand name, the division’s name before the business was acquired by Cascade. Another Cascade location, the Kraft paper mill in Kingsey Falls, Quebec, was not so lucky and will be permanently closed, ending Cascade’s production of Kraft products. A small mill in eastern Connecticut, Fusion Paperboard, was also unable to economically sustain production and closed.

In the commercial printing segment, SG360° headquartered in Wheeling, Illinois, acquired direct mail printer Lehigh Direct from Visant. SG360° reported that the deal brings its revenues to more than $300 million, and that the combined entity will mail over two billion pieces of mail annually.


2014 July - Mergers and Acquisitions in the Printing, Packaging, Paper & Related Industries  

Deal Party #1
(Surviving Entity)
Pre-Deal
Revenues
($Mil )


Party #1 Address


Deal Party #2
Pre-Deal
Revenues
($Mil )


Party #2 Address
Date
Deal
Public
Deal
Value
($Mil)

Deal Structure
(Intermediary)


Notes

Press
Releases
E.W. Scripps $1,223 Cincinnati, OH Journal Media Communications N/A Milwaukee, WI  7/30/14 No Data Spin-off Newspaper publishing Link
E.W Scripps $822.0 Cincinnati, OH Journal Communications $400.7 Milwaukee, WI  7/30/14 No Data Merger Publishing & broadcast Link
DocuSource $6.0 Morrisville, NC One to One Group $2.0 Sarasota, FL 7/29/14 No Data Acquisition Direct mail Link
FiberMark No Data West Springfield, MA Crocker Technical Papers No Data Fitchburg, MA 7/29/14 No Data Asset acquisition Specialty paper mill Link
OSG Billing Services No Data Englewood, NJ SouthData No Data Mount Airy, SC 7/24/14 No Data Acquisition Transactional printing Link
Levine Leichtman Capital Partners No Data Los Angeles, CA Fastsigns International No Data Dallas, TX 7/22/14 No Data Acquisition
(North Point Advisors)
Sign shop franchisor Link
Gatehouse Media
(Sub. New Media Investment Group )
$586.8 New York, NY Providence Journal
(Sub. A.H. Belo)
No Data Providence, RI 7/22/14 $46.0 Acquisition Community newspapers Link
Electronics for Imaging (EFI) $757.7 Foster City, CA DirectSmile No Data Berlin, Germany 7/21/14 No Data Acquisition Web-to-print software Link
F.P. Horak No Data Bay City, MI TBF Graphics No Data Saginaw, MI 7/18/14 No Data Merger Commercial printing Link
Integrated Whale Media Investments No Data Hong Kong Forbes No Data New York, NY 7/18/14 No Data Acquisition Publishing Link
SG360°
(sub. Segerdahl)
No Data Wheeling, IL Lehigh Direct
(sub Visant)
No Data Broadview, IL 7/16/14 No Data Acquisition Direct mail printing
(combined $300 Mil revenue)
Link
Allegra Marketing Print Mail No Data Harrisburg, PA Neighborhood Greetings No Data Millersville, PA 7/14/14 No Data Acquisition Direct mail Link
OEC Graphics No Data Oshkosh, WI MGM Graphics No Data Lynwood, WA 7/11/14 No Data Acquisition Corrugated packaging Link
Investcorp No Data London, UK SPGPrints No Data Boxmeer,
Netherlands
7/10/14 No Data Acquisition Rotary screen printing units Link
Publishers’ Graphics No Data Carol Stream, IL Commercial Letter No Data St. Louis, MO 7/8/14 No Data Acquisition Direct mail printing Link
Multi Packaging Solutions No Data New York, NY Armstrong Packaging No Data Arbroath, Scotland 7/8/14 No Data Acquisition Specialty rigid boxes Link
Cathedral Corp No Data Rome, NY AXIS Data Solutions No Data Orlando, FL 7/7/14 No Data Acquisition Transactional printing Link
NYC Community Media  No Data New York, NY Community Newspaper Group  No Data Brooklyn, NY 7/3/14 No Data Acquisition Community newspapers Link
Atlas Paper Mills
(Peak Rock Capital Portfolio Co.)
No Data Austin, TX Accurate Paper Recycling No Data Tampa, FL 7/2/14 No Data Acquisition Paper recycling Link
H.I.G. Capital No Data Miami, FL Cascades Fine Papers Group
(Re-branded Rolland Enterprises)
No Data Saint-Jérôme, QC 7/2/14 No Data Acquisition Specialty fine papers Link
Adams Publishing Group No Data Minneapolis, MN Huckle Media  No Data Faribault, MN 7/1/14 No Data Asset acquisition Community newspapers Link
Jet Service Accura Printing No Data Barre, VT Spaulding Press No Data Bethel, VT 7/1/14 No Data Merger Commercial printing Link


2014 July - Bankruptcy Filings in the Printing, Packaging, Paper & Related Industries



Filing Party

Date
Case
Filed
Pre-Petition
Revenues
($Mil )



Case #



Filing Party Address



Circuit



Region & City



Judge



Attorney for Debtor



Notes
Chapter 11 Filings:
No Chapter 11 Filings Found this Month --- --- --- --- --- --- --- --- ---
Chapter 7 Filings:
Martinez Press, Ltd. 7/30/14 No Data 14-27932 Chicago, IL 7th Northern IL
Chicago
Jack B. Schmetterer Mehul D. Desai Commercial printing
Carolina News Company, Inc 7/24/14 No Data 14-04161 Mauldlin, SC 4th South Carolina
Columbia
Helen E. Burris Sidney Wike Magazine wholesale distributor


2014 July - Non-Bankruptcy Closures in the Printing, Packaging, Paper & Related Industries



Closed Company / Facility

Date of Closure
Pre-Closure
Revenues
($Mil )



Closing Address
Related Party Related Party
Address
Date Closure Public


Notes

Press
Releases
Visual Controls
(DBA Champ Direct)
Jul-14 No Data Milford, CT None N/A 7/28/14 Direct mail printing Link
University of Arkansas - Print Shop 7/1/16 No Data Fayetteville, AR University of Arkansas Fayetteville, AR 7/24/14 In-plant printing facility Link
Fusion Paperboard Sep-14 No Data Sprague, CT None N/A 7/23/14 Paperboard mill Link
Cascades - Paper Mill 10/3/14 No Data East Angus, QC Cascades Kingsey Falls, QC 7/9/14 Kraft paper mill Link
Fidelity Investments - Printing Facility Jul-15 No Data Grapevine, TX Fidelity Investments Boston, MA 7/9/14 Transactional printing Link
Fidelity Investments - Printing Facility Jul-15 No Data Covington, KY Fidelity Investments Boston, MA 7/9/14 Transactional printing Link
Lifetouch Services Dec-14 No Data Kansas City, MO Lifetouch Eden Prairie, MN 7/8/14 Yearbook printing Link
Scotsman Media Group 7/3/14 No Data Chenango Bridge, NY None N/A 7/1/14 Community newspapers & shoppers Link
Scotsman Media Group 7/3/14 No Data Syracuse, NY None N/A 7/1/14 Community newspapers & shoppers Link