Quad/Graphics to Obtain Vertis Communications

SUSSEX, WI—Quad/Graphics Inc. and Baltimore-based Vertis Holdings announced the execution of an agreement through which Quad/Graphics will acquire substantially all of the assets comprising Vertis’ businesses for $258.5 million, which includes the payment of approximately $88.5 million for current assets that are in excess of normalized working capital requirements.

To facilitate the intended sale, Vertis, along with its subsidiaries, filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code and, at the same time, filed documents seeking the bankruptcy court’s approval of the proposed sale to Quad/Graphics. Vertis has the support of its lenders with respect to the sale to Quad/Graphics.

Upon completion, the acquisition will enhance Quad/Graphics’ position as a leader in the production of retail advertising inserts, direct marketing and in-store marketing solutions while providing continuity, financial stability and continued business investment for Vertis’ clients and employees.

Quad/Graphics intends to use cash on hand and draw on its revolving credit facility to finance the acquisition of Vertis, which expects to generate approximately $1.1 billion in revenues during fiscal year 2012. The combined entity will realize efficiencies and cost-savings derived from a superior and more efficient operating platform, expanded volume-driven mailings and more efficient procurement programs.

Clients will benefit from an enhanced range of products, services and revenue-generating solutions; expanded industry vertical expertise; increased manufacturing flexibility and distribution efficiencies from an extended geographic footprint; and new opportunities to realize mailing and distribution cost-savings from the combined volumes and capabilities of the two companies.

“Quad/Graphics believes in the power of print in today’s multichannel media world and this acquisition further strengthens our ability to help retailers and direct marketers drive meaningful business results,” said Joel Quadracci, chairman, president and CEO of Quad/Graphics. “The combination of Quad/Graphics and Vertis is a natural and strategic fit.

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  • Stan Konwiser

    This acquisition is the next big step collapsing the capacity of the printing industry. Quad will get the advantage of all those newspaper inserts traveling through the Quad Logistics platform and Quad will get to supervise the capacity destruction by shutting down plants and taking equipment off line. If Vertis goes under, much of that equipment might reappear to compete with Quad in the future. Vertis has 19 plants, that comes to less than $14mm per plant all in! Now for a small cost, Quad can keep control and expand its market into the newspaper insert business. My guess is that at the end of this protracted industry shakeout, there are going to be only a few major players standing. Quad wants to be one of those players.

  • Michael Bense

    I’ve just finished reading the article regarding this latest Chapter 11 filing by Vertis. Must be nice to just file bankruptcy (twice) because of total mismanagement.

    It would be nice if Printing Impressions, did research to find out the number of suppliers that they have affected by their last filing, as well as, this one. How many small suppliers have gone out of business because of Vertis’s last filing and how many now will be on the verge of closing themselves because of these lost payments or pennies on the dollar.

    I wonder how many fine people with 10, 20 years or more, will now be loseing their jobs because of management’s ineptitude.

    The senior management at Vertis is an embarrassment to the industry and to the owners, presidents and CEO’s of other direct marketing organizations.

    Might also be nice to see how much money Mr. Sokol will walk away with, even after his complete failure as the CEO.


    Michael Bense
    Street Smart Marketing