SOURCE - The Target Report
As printing industry consolidators grow, merge, fail, sell out, or otherwise exit the playing field for the acquisition of lower middle market and family-owned companies, new smaller consolidators rise up to take their place, often with financial backing from a private equity sponsor.
Consolidators Grow Up and Leave the Lower Middle Market Behind
CJK has been a very active aggregator of companies in the book manufacturing business (see CJK Goes Global as Cenveo Unwinds – September 2020). Of late, CJK has increased the size and diversity of its acquisitions, most recently with the acquisition of Tweedle Group. The acquired company is itself quite sizeable, with over 500 employees worldwide. Tweedle primarily serves global equipment manufacturers with content management and e-delivery services, as well as printed material, related to technical product support. This follows CJK’s acquisition of Cenveo’s content management business. CJK is no longer simply a consolidator of US book manufacturing plants, the company has turned to hunting bigger game in the related, but distinctly non-print at its core, business of content management.
Other print industry consolidators have exited or are busy with their internal efforts to integrate past roll-ups of roll-ups. For example, the recent combination of Fort Dearborn and Multi-Color Corporation under the new ownership of Clayton, Dubilier & Rice has created a mega-sized label manufacturing conglomeration. (See Packaging Industry Consolidation in Every Direction – July 2021). At the size of this new combined label printing company behemoth, will it make sense to acquire more lower middle market family-owned and managed label printers?
In the folding carton segment, the formerly very active consolidator Multi Packaging Solutions was taken out of the mix in 2017 when it was acquired by WestRock. (See WestRock Affirms Commitment to Paper – January 2017). And for those of us that hail from the commercial printing segment, it seemed like exit purchase multiples dropped two turns the day the music died when RR Donnelley took Consolidated Graphics out.
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