Mergers and Acquisitions

Quad/Graphics will become a public company with acquisition; United Scale and Engineering Corp. acquired by Transcat; GMR Marketing acquires German firm

Quad/Graphics will become a public company with acquisition

Quad/Graphics Inc. will acquire World Color Press Inc., and the merged corporation will become a publicly traded company after an initial public offering (IPO).

The combined company will be the second largest provider of print, digital and related services in the Americas. It will have nearly 30,000 employees serving customers in the U.S., Canada, Latin America and Europe.

The boards of directors of both companies unanimously have approved a definitive agreement to merge.

Worldcolor and Quad/Graphics had aggregate unaudited revenues for the 12-month period ended Sept. 30, 2009, of $5.1 billion.

The transaction is expected to close this summer.

Quad/Graphics’ management estimates that the combination will generate approximately $225 million in pre-tax net annualized synergies within 24 months.

“By combining the strengths of both companies, we will enhance our leadership position in the printing industry,” said Joel Quadracci, who will continue in his roles as Quad/Graphics chairman, president and chief executive officer. “Customer needs and demands are rapidly evolving, and our expanded company will be even better equipped to meet those demands. With increased access to capital markets, we plan to make appropriate investments in our platform and data-driven solutions to secure the future of print. With our strong commitment to innovation and customer satisfaction, combined with the greater operational efficiencies we are targeting, we will be better able to achieve our strategic objectives and continue to generate industry-leading margins and profitable growth, all while creating opportunities for our customers, shareholders and employees.”

Concurrent with the closing of the transaction, Quad/Graphics intends to become a publicly traded company. Quad/Graphics expects to register its Class A Common shares with the U.S. Securities and Exchange Commission (SEC) and proceed with a listing on a leading U.S. exchange.

Under terms of the agreement, World Color shareholders will receive at closing approximately 40 percent of the outstanding shares of Quad/Graphics, and Quad/Graphics’ shareholders will hold approximately 60 percent of the shares.

The future board will be comprised of the six current Quad/Graphics directors and two World Color directors.

Quad/Graphics’ shareholders will continue to own Class A, Class B and Class C shares for approximately 60 percent total ownership of the company. The Harry V. Quadracci family will control the company through ownership of the high-voting Class B shares. The Class C shares are owned by a qualified retirement trust for Quad/Graphics employees.


United Scale and Engineering Corp. acquired by Transcat

Waukesha-based United Scale and Engineering Corp., a distributor and servicer of industrial equipment, has been acquired by Transcat Inc., a Rochester, N.Y.-based distributor of handheld test and measurement instruments.

Transcat is publicly traded under the symbol TRNS on the Nasdaq exchange. Terms of the acquisition were not disclosed.

United Scale has grown itself through three different acquisitions previously, said Judy Trenec, president of the company.

“We continued with that thought, that we wanted to grow our business, but the (companies) we looked at in the last two to three years didn’t pan out,” she said. “We decided to go into another direction and see if a larger firm might be interested in us.”

United Scale’s approximate 2,000 customers in Wisconsin, Illinois and the Upper Michigan made it an attractive acquisition, said Charles Hadeed, president, CEO and COO of Transcat. Its market position in sales and service of industrial scales and other equipment also made it a logical bolt-on to the company.

“United Scale is a well respected name and a well known provider of sales and service. This acquisition expands our product line into scales and the service of scales,” Hadeed said. “A major component of our growth strategy is to acquire smaller calibration services companies within this highly fragmented industry, which further broadens our calibration capabilities, geographically complements our current 12 calibration laboratories’ locations and capitalizes on the strength of our infrastructure and reputation for quality, service and integrity.”

United Scale and Engineering has about 30 employees. Judy Trenec, president of the company, will join Transcat and will continue to manage the United Scale operation.

“We will be basically running the business the way it always has been,” Hadeed said. “We believe that United’s similar customer-focused philosophy of earning trust and respect through value will enable a smooth and rapid integration into Transcat."

Transcat was an attractive buyer for United Scale because of its size and health, Trenec said. Transcat’s profits increased by more than 27 percent in 2009.

“We shared a lot of clients and they could see opportunities to grow,” she said. “The larger we are here, the more opportunities we have for promotions for our employees. I think we will have a good fit together.”

Waukesha-based Mertz Associates and Tim Reardon, an attorney with Reinhart, Boerner, Van Deuren S.C. represented United Scale in the transaction.


GMR Marketing acquires German firm

New Berlin-based GMR Marketing LLC has acquired Germany-based marketing and advertising firm Experience.

Experience will be integrated into the Global GMR brand.

“We are delighted to enter the German market with an agency of the quality and strength of Experience, which has been one of Europe’s top-ranked agencies for so long,” said GMR Marketing founder, chairman and CEO Gary Reynolds. “The addition of Experience is mutually beneficial. Our new colleagues have access to GMR’s expertise and innovation, while expanding our presence in Europe will open doors for our clients and their growing need for global platforms. It also increases our understanding of the global consumer.”

With the Experience acquisition, GMR Marketing now has 14 offices in five countries.

“Joining the GMR family will be of great value to our loyal clients and will open doors in other regions of the world,” said Uwe Alten, Experience’s managing director in Frankfurt.


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