Printing Company Buyers Offer Insights at NAPL Top Management Conference

The recently concluded NAPLTop Management Conference served as an informal venue for strategic acquirers to exchange insights about current mergers and acquisitions trends in the print and graphic communications industry.

Here are four key messages we heard from folks at the NAPL Top Management Conference:

1. Very few attendees would buy a going entity, and, if they did, they wouldn't pay much;
2. Growth by acquisition of general intangibles (customer relationships) remains in vogue among successful companies, but the seller's debt burden has replaced seller's unrealistic expectations as the single biggest impediment to closing more acquisitions of distressed printing companies;
3. The psychological climate continues to be negative, thus limiting the level of risk that buyers are willing to take even if the risk is mitigated by the use of performance-based currency such as royalties and earn-outs; and
4. The banking climate is a double-edged sword for buyers, in that troubled borrowers are sometimes forced into a sale of the business, but acquirers should be sure that their bank is conceptually on board with the concept of growth by acquisition BEFORE beginning dialogue with candidates. 

Having had the opportunity to work with clients and to network with others at the conference, I believe that over 75% of the roughly 100 printing companies in attendance would consider some form of acquisition, alliance, or other strategic transaction as a way to augment organic growth.