Quad/Graphics to acquire Massachusetts book manufacturer

Sussex-based Quad/Graphics Inc. announced on Friday that it will acquire Courier Corp. of North Chelmsford, Mass., the nation’s second-largest book manufacturer, for approximately $260 million.

The acquisition accelerates Quad/Graphics’ recently announced three-year strategy to transform its book platform in order to follow a print-on-demand, zero-inventory model. The investment includes investing in 20 or more HP high-speed color digital web presses, front-end workflow solutions and back-end integrated systems.

“We are excited about the opportunities ahead with Courier as part of our company and the value it creates for both our companies’ clients and shareholders,” said Joel Quadracci, Quad/Graphics chairman, president and chief executive officer. “Courier has a legacy of superior quality and exceptional customer service, and is a well-known innovator in every aspect of book production, from content management to printing, binding, distribution and integration with electronic media.”

Quad/Graphics expects the acquisition to close by mid-year after which James Conway III, Courier’s chairman, president and chief executive officer, will join Quad/Graphics as president of the book division. Courier has about 1,600 employees, but Quad declined to comment on how its employees and locations would be integrated following the acquisition.

Courier was an early adopter of the digital print technology that is rapidly changing the dynamics of the book industry. According to Quadracci, Courier pioneered the development of customization solutions that now bring class-specific versions of academic textbooks to millions of students each year.

“The company has continually reinvested in its platform, and with our previously announced investment in 20-plus digital presses and integrated systems, together we will accelerate a broad industry transition to a print-on-demand, zero-inventory model,” Quadracci said.

Conway added: “After a careful and thorough evaluation process, the Courier board has determined that the transaction with Quad/Graphics maximizes value for our shareholders. The board strongly believes that this transaction achieves that result, providing a substantial premium for our shareholders.”

Quad/Graphics will pay Courier shareholders the equivalent of a total purchase price of $20.50 per share, consisting of cash and shares of Quad/Graphics Class A common stock. Each Courier shareholder will have the right to elect to receive cash or Quad/Graphics common stock, subject to proration in the event that shareholders elect to receive more than 54 percent cash or more than 46 percent stock. Quad/Graphics will pay an aggregate amount consisting of approximately $129 million in cash and about 4.8 million shares.

“I am delighted to bring Courier together with another company that shares our values, offers complementary capabilities and opens up a world of additional opportunities,” Conway said. “We are confident that the combination of our two companies will create the most opportunities for customers and employees well into the future. Like Courier, Quad/Graphics represents the very best in technology and service for the 21st-century marketplace. The addition of Courier’s four-color offset presses, digital inkjet presses, end-to-end process management and integrated software solutions further enhances Quad/Graphics’ efforts to transform the book industry to the benefit of publishers and readers everywhere.”

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