Trends in Mergers and Acquisitions
During the BookTech 2000 seminar "Quick Update: Digital Technologies and Economic Trends," Mark Bawden, senior vice president, sales and marketing, Von Hoffman Graphics, outlined current trends in mergers and acquisitions. He also noted the factors behind them in the book publishing industry.
Why do book printers merge?
* To achieve faster growth in their niche;
* to expand into other niches;
* to add "mass" to go public;
* in response to changes in print buying habits;
* in recognition of manufacturing synergies;
* because of technology issues;
* in reaction to family business issues.
* in response to merging of customers within a niche;
* to expand into other non-printing book-related services, such as prepress, distribution and fulfillment;
What are the future trends in book printing mergers?
* There seems to be less stock market interest in print consolidation these days, Bawden noted.
* The prices demanded by independent printers are rising dramatically.
* Capital requirements after mergers are large.
* Business is good now for the independent book printer, he continued.
The industry probably will see mergers of book manufacturers slow down in the near term, but continue at a relatively steady rate in the future due to the reasons outlined above, said Bawden.
How should publishers react to print mergers?
* Get to know the new management team.
* Monitor new strategies.
* Ask about capital availability after the merger.
* Tour plants and talk to employees and managers.
* Be aware of old and new cultures.
* Understand the synergies of the merged players.
* Make it a point to learn about future plans.
* Keep in mind that mergers can be very good for the attentive and knowledgeable