ST IVES' U.S. DIVISION -- Adding to the Equation
BY ERIK CAGLE
It has been said by many a merger and acquisition prognosticator that modern-day deals need to do more than bring aboard added sales dollars. Today's deals need a reason to exist.
Long before the September 11 terrorist attacks and the subsequent retaliatory strikes, the economy had been in a sustained, downward spiral. The Federal Reserve's slicing of interest rates has registered barely a blip on the radar screen. It doesn't take a newspaper or even an industry magazine to realize that there is a recessional fear and a disturbing degree of uncertainty gripping the nation.
Not surprisingly, any merger or acquisition in the commercial printing industry that transpires during the current climate needs to be the proverbial strategic fit. The poster child of such transactions is the marriage of Avanti/Case-Hoyt to St Ives, which took place earlier this year. St Ives acquired the outstanding common stock for a cash consideration of $42 million in February. The deal comes roughly eight years following the merger of Avanti and Case-Hoyt.
This Year's Big Deal
The acquisition was one of, if not the, largest deals in the industry in 2001—Avanti/Case-Hoyt posted sales of $109 million in 2000 while St Ives checked in around the $115+ million range. It also gave St Ives plc, the London-based worldwide printing stalwart, strategic positions in Rochester, NY, and Miami to complement its existing U.S. holdings in Cleveland and Hollywood, FL.
The newly formed company has 1,350 employees and is projecting sales of $224 million for the fiscal year ending July 31, 2001.
According to Gary Davis, senior vice president and general manager of St Ives Cleveland, the pairing represented a matchup with numerous benefits. "The acquisition was a strategic fit for several reasons," he remarks. "Avanti and Case/Hoyt were well-regarded entities in their fields. Avanti has a solid reputation within the cruise and retail markets, and Case/Hoyt in high-end financial publications, brochures and the like.