Mergers and Acquisitions

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Quad/Graphics acquires stake in HGI Company; Bemis completes acquisition of Food Americas

Quad/Graphics acquires stake in HGI Company

Quad/Graphics Inc. has formed a strategic partnership with HGI Company, a Burlington-based full-service, multi-faceted commercial printer.

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Under terms of the agreement, Quad/Graphics will purchase a minority interest in HGI, providing HGI with additional financial resources to continue its aggressive investment and product diversification strategy, and to further its goal of enhancing, expanding and replicating its commercial platform across more geographies.

Craig Faust will retain majority ownership of HGI and will continue to lead the company as its president and chief executive officer.

HGI has 245 full-time employees at its three facilities in southeastern Wisconsin. The company reported sales of $45 million in 2009.

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Through the partnership, HGI will build upon its current market diversification, flexibility and range of capabilities.

Both entities will share best practices in manufacturing, management, customer service, procurement and more, while creating numerous advantages and opportunities for clients, employees and shareholders.

"The ability for both our companies to leverage resources and industry knowledge in our respective business segments will create one of the most unique and diverse product offerings in today’s print marketplace," Faust said. "Through this partnership, HGI will be able to make investments that will allow us to execute more quickly on our growth strategy in short- to medium-run length commercial print. We’ll also leverage Quad/Graphics’ cutting-edge technology and capabilities and operational expertise to better serve our clients and give them the most value for their print spend."

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"We are proud to be partnering with an aggressive, forward-thinking company like HGI, which shares our same commitment to advancing the effectiveness of print in a multi-channel media world," said Joel Quadracci, chairman, president and CEO of Quad/Graphics. "Craig and his management team have expertly guided the strategic growth of HGI, assembling a group of distinctively branded companies that serve diverse but complementary markets, and that provide an incredible range of commercial print services. Our investment will serve as an important springboard to its growth."

Bemis completes acquisition of Food Americas

Bemis Company Inc. has completed its acquisition of the Food Americas operations of Alcan Packaging, a business unit of Rio Tinto plc.

Under the terms of the $1.2 billion transaction, Bemis acquired 23 Food Americas flexible packaging facilities in the United States, Canada, Mexico, Brazil, Argentina and New Zealand, which recorded 2009 net sales totaling $1.4 billion.

These facilities produce flexible packaging principally for the food and beverage industries and will augment Bemis’ product offerings and technological capabilities. The transaction is expected to be accretive to both diluted GAAP earnings per share and adjusted earnings per share, beginning in 2010.

Under the terms of an order signed by the U.S. District Court for the District of Columbia on Feb. 25, two of the facilities, located in Menasha, Wis., and Tulsa, Okla., must be divested. The 2009 net sales associated with the facilities to be sold was approximately $100 million.

"We are pleased to welcome our newest Bemis employees and look forward to integrating these new facilities into our business," said Henry Theisen, Bemis president and chief executive officer. "During the next two years, we expect to generate strong cash flow which we will use to invest in growth opportunities, pay down debt, and deliver attractive total returns to our shareholders. This acquisition complements our manufacturing capabilities and technological expertise around the world. We are looking forward to an exciting and successful 2010."


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