It’s a feeding frenzy in the prime label printing and converting business. Fueled by multiple private equity-backed roll-up platforms.
Mark Hahn
The annual review reviews, categorizes, sorts, counts, and charts data comparing the trailing twelve months ended this August.
There has been no pause, not even a brief breather, in the steam roller-like consolidation of the packaging-related printing businesses. The driving imperative is to consolidate production both horizontally to build out a global network to service global brands, as well as vertically to link supply chains to ensure material availability.
The future of print will increasingly be individually customized with the images we want applied to whatever products we choose.
A prospective client recently asked me if the use of a Special Purpose Acquisition Company might be applicable to their firm. I said SPACs were suited to much bigger companies. I was wrong. In the case of one industrial printing company, a merger into a SPAC is the pathway to value and liquidity for the owners.
It finally happened. PIA and NAPL have joined forces, or at least the remnants of each will now be together under the umbrella of PRINTING United Alliance. That and more in this month's Target Report.
In this month's edition of the Target Report, ProAmpac targets the old-fashioned brown paper bag in one of the most aggressive roll-ups in the flexible packaging business, and both Ebony and The Village Voice rise from the dead.
Not only do movements in the book printing world hint at the need to keep up with demand, consolidation is also rolling along at a steady pace in the label business.
Clearly, consolidation of the printing industry will continue; some consolidators will succeed, and others, for reasons of misplaced strategy, or simply bad timing in a tumultuous market, will need to deconsolidate whether via a trip through bankruptcy court or divestitures.
The Target Report, August 2020: M&A activity in commercial printing dips, tuck-ins still predominate; packaging deals are driven by private equity; labels lead the pack; wide format transactions pick up; and more …
June was the first relatively active month for M&A deals since the COVID-19 induced shut-down began. The renewed transactional activity is a clear indication that packaging manufacturers expect demand for packaged products to continue apace or grow, and as a consequence, the appetite for their packaging expertise and capacity will tag right along and grow also. A perfect recipe for more deals in the future.
Graphic Village’s acquisition of DMS ink is part of a trend of consolidators building a network of locations within a distinct region.
As the industry converges and consolidates, so have many trade associations. This might be best exemplified by the recent merger of SGIA and PIA, which is reflective of the ongoing consolidation in the highly fragmented and diverse universe of companies that make up the industry.
The Target Report is usually a gestalt of the prior month’s transactional activity. However, given the seismic nature of the current crisis, the rear view mirror is less useful, so we’ll depart from our usual style this month, look backwards just a bit, and offer our view through the front windshield.
The Welch Packaging Group acquired PAX Corrugated Products from Georgia-Pacific amid a trend of the company making corrugated acquisitions. This supports the trend of regional companies leapfrogging to an adjacent metro market via a series of strategically sound acquisitions.
