Midsummer Lull Ends With New Flurry of Activity
HOUSTON—The heat of midsummer seemed to have slowed the ongoing acquisition fever in the graphic arts business, but as summer winds down and executives return from vacation, a new spate of acquisition announcements has arrived.
Consolidated Graphics, based here, led the pack, signing letters of intent to acquire five new companies. Four of the new acquisitions—McKay Press in Midland, MI, Royle Communications in Sun Prairie, WI, Graphtec in Annapolis Junction, MD, and Printing Corp. of America in Baltimore— were acquired in one transaction led by Radnor, PA-based Compass Capital Partners. Only days later Consolidated signed another deal to acquire Bloomington, IL-based Metropolitan Printing Service.
Upon completion of pending acquisitions, Consolidated will have 47 companies nationwide with annualized revenues in excess of $555 million.
Somewhat of a surprise was the announcement out of Waterloo, WI, that Perry Judd's had sold Baltimore-based Port City Press, a technical journal and reference directory printing operation, to Easton, PA-based Mack Printing. Port City was acquired 10 months ago as part of the deal in which Perry acquired Judd's Inc.
"For Mack, this represents their first major acquisition following a recapitalization in 1997," notes Gregg Feinstein, a principal at the New York-based financial services firm of Berenson Minella & Co., which advised Perry Judd's in the deal.
"For Perry Judd's, this was a logical move that will allow them to dedicate all their management time and financial resources to their core publication and catalog segments," Feinstein adds.
Englewood, CO-based Mail-Well is also back in the acquisition hunt. It has signed a purchase agreement to acquire Florida sheetfed printer Graphics Illustrated and its affiliate Digital X-Press, and Mississauga, Ontario's McLaren, Morris and Todd Ltd., a US$34 million web and sheetfed operation specializing in consumer products labels, direct mail literature and general printing.
Back in New York, Unidigital signed an agreement to acquire MegaArt Corp., a national producer of large-format, digitally printed graphics. When the sale is complete, MegaArt will become part of Unidigital's Unison division and will remain an autonomous business unit.
Unison currently supports customers in the retail, trade show, transit and outdoor advertising markets, from facilities in New York, San Francisco and Boston. MegaArt is best known for the development and production of banners, some over 30,000 square feet. Udi Aloni, MegaArt's founder, will continue as president of the company.
Memphis, TN-based Master Graphics, which only weeks ago became a public company, has joined the acquisition hunt. It has signed a letter of intent to acquire Huntsville, AL-based Golden Rule Printing, a general commercial sheetfed company that often does work in the compact disc and software packaging niche. Master Graphics currently has 11 divisions located across the country.
While all of this acquisition activity took place, Quebecor Printing (USA) announced plans to close a former American Signature catalog plant in Atlanta this fall, according to published reports. Union representatives say about 300 people work at the plant, which was acquired by Quebecor last year.
Before Quebecor owned the site, the plant endured a bitter four-year strike that began when the then-owner, a Japanese bank, fired the entire work force, and then rehired, at lower wages, all but 47 union employees.
At its height, the strike was a popular cause in this Southern metropolis, featuring appearances on the picket line by civil rights leader Jesse Jackson. Last year a National Labor Relations Board administrative judge ruled in favor of the union, but the acquisition by Quebecor shortly thereafter rendered the ruling largely meaningless.
Finally, in Dayton, OH, Standard Register began construction of a 40,000-square-foot addition to its corporate headquarters, as it makes plans to close its Adrian, MI, customer service center by the end of the year, as part of the company's integration effort following its purchase of UARCO Inc. The Adrian-based Standard Register warehouse and STANFAST print center are not affected. The Adrian facility currently manages warehouse releases and replenishment orders for customer inventory.
