Recap and Forecast: State of M&A in the Commercial Printing Segment

As we reflect on the past year, which was a healthy one overall for mergers and acquisitions in the printing industry, it’s a good moment to assess what drove the activity in 2025 and what’s likely to carry the momentum forward into 2026.

The industry’s two principal segments — packaging and commercial printing — have different financial parameters. But the macroeconomic trends underpinning them are the same, and those forces remain encouraging for buyers and sellers alike.

Especially reassuring is the fact that the pace of M&As is coming back up to what it was in the early years of the present decade. 2021 and 2022 were record breakers in terms of transactions completed — as M&A advisers, we were never busier. Although not quite as hyperactive, 2023 was a blockbuster in its own right.

Then came the slowdown of 2024: not because of any shortage of buyers, but because many sellers had decided to hold off going to market.

They pushed the pause button partly out of uncertainty surrounding the presidential election and its implications for business and the economy. The other drag on their plans was a slowdown for the industry as a whole, with real sales growth of -2.1% during the first half of 2024 followed by a -1.1% decline in the third quarter.

We can report that the pace has picked up again in 2025, so much so that in the remainder of the year and into 2026 we expect activity to look more like it did in 2023 than it did in 2024.

Tracking the Tailwinds

Consider the general trends. Banks and other financial institutions remain willing to lend capital for funding M&As. The Federal Reserve cut its benchmark overnight interest rate in September and possibly will have done it again by the time this article is published, easing the cost of borrowing money. The multiples of publicly held printing and packaging companies continue to be strong.

But the best reason for optimism may be that new buyers, particularly private equity (PE) investors, are still coming into the industry. In fact, more buyers are active out there than ever before.

PE-funded financial buyers have abundant money to spend on aggregating multiple companies into business platforms that they resell after optimizing profit performance. Strategic buyers with excess capacity to fill know that often the best way to do this is by acquiring the sales volume of other companies. In both cases, value is created for shareholders, customers, and other stakeholders.

What it all means is that now is a very favorable time to be a seller or a buyer. There has been no slowdown of interest in financially healthy, well differentiated companies in either the commercial printing or the packaging space. The only question is how long the present set of circumstances will last.

To guess at that, we have to look at the relationship between the growth rate of the printing industry and that of the gross domestic product (GDP).

It used to be that they moved in parallel: when growth in GDP increased, so did growth in industry revenues. But as last year’s negative growth trends for the industry make clear, that connection is no longer unbreakable. What’s more, GDP growth has declined from 5.9% in 2021 to a forecasted 1.7% in 2025 — a trend that doesn’t augur positively for growth in
any industry.

Reality Check

The effects of the downward trend are plain to see in the commercial print segment, where revenue growth and multiples of EBITDA tend to lag those of label and packaging producers.

Many commercial firms are struggling to maintain sales, some to the point where organic growth has become almost impossible for them to achieve. This accelerates the fragmentation of the industry by driving more sellers into the M&A marketplace, where buyers pursuing strategies of growth by acquisition are waiting for them.

The sellers mostly are owners of traditional printing companies that have not expanded much beyond the basic business of putting ink on paper. The principals tend to be at or close to retirement age. For many of them, selling has become the only path toward making a financially feasible exit from the industry at whatever price a buyer can be persuaded to offer them.

Progressive firms, on the other hand, are on stronger ground by virtue of the investments their owners have made in technology that equips them for growth in up-and-coming print markets. These firms are the commercial segment’s haves, and the gap in value between them and the have-nots has never been greater. Have-nots, the opposite in terms of forward-looking strategic planning, become natural acquisition targets for the haves.

The markets that a commercial printing business serves matter as well. One-to-one direct mail marketing, for example, is still a very attractive segment to be in, particularly if the company provides the data management as well as the printing services. Data-driven direct mail houses have been able to offset increases in postal rates from the profits they make by offering their customers more tightly targeted mailing campaigns in smaller volumes.

We also continue to see vigor in book manufacturing, where digital production has made it possible to build a business model around producing in very small quantities — even as small as runs of one. The market for POP and retail graphics is also holding up well.

M&A ‘Magnetism’

A progressive “have” in the commercial segment can be a powerful magnet for buyers. One of our selling clients has invested heavily in digital technologies for print on demand and is recognized as a leader in that field. All but one of the buyers we marketed this company to are working on offers.

Another one of our haves is a commercial business that now derives about 60% of its revenue from printing. It gets the rest from ancillary specialties such as kitting and fulfillment, which enable the company to position itself to its customers as a one-stop source of logistical services. The icing on the cake is a web portal for order entry. This company goes to market with a multiple of EBITDA that many general commercial shops would envy.

One of the soundest pieces of advice we can offer owners of commercial printing businesses as 2025 winds down is to seek differentiation by adding new products and services that customers want but can’t readily obtain from the competition. Catering to customers in this way keeps them close and “sticky,” protecting both the top and the bottom lines.

Every owner also should make a fundamental decision to sell the business at some point in the future or to go on growing it by acquiring another company. Action on the decision does not have to be taken right away, but the choice of direction should be clear. One of the main driving forces of the industry today is the dynamism of the M&As taking place within it. That in itself is a profit opportunity for owners who know what their next steps can be.