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Quad Enters into Definitive Agreement to Sell the Majority of its European Operations to Capmont

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Quad/Graphics, Inc. (NYSE: QUAD) has announced a definitive agreement to sell the majority of its European operations to Germany-based Capmont GmbH for €41 million (approximately $45 million). The transaction includes all employees and facilities for Quad/Graphics Europe print and ink-manufacturing in Poland, the Peppermint agency in Warsaw, and Quad POS with locations throughout Europe. Quad will maintain printing operations that support its marketing experience (MX) offering.

The sale, expected to close by year-end 2024, aligns with Quad's strategy to optimize its business portfolio for growth as a marketing experience company. Quad plans to use the proceeds to reduce debt and invest in solutions that advance its MX offering. The company will continue to focus on operations in the Americas, particularly North America, where it believes it can provide the greatest value to clients through its integrated marketing platform.

Quad/Graphics, Inc. (NYSE: QUAD) ha annunciato un accordo definitivo per vendere la maggior parte delle sue operazioni europee alla società tedesca Capmont GmbH per 41 milioni di euro (circa 45 milioni di dollari). La transazione include tutti i dipendenti e le strutture di Quad/Graphics Europe stampa e produzione di inchiostro in Polonia, l'agenzia Peppermint a Varsavia e Quad POS con sedi in tutta Europa. Quad manterrà le operazioni di stampa che supportano la sua offerta di marketing experience (MX).

La vendita, prevista per chiudere entro la fine del 2024, si allinea con la strategia di Quad di ottimizzare il proprio portafoglio aziendale per la crescita come azienda di marketing experience. Quad prevede di utilizzare il ricavato per ridurre il debito e investire in soluzioni che migliorino la sua offerta MX. L'azienda continuerà a concentrarsi sulle operazioni nelle Americhe, in particolare in Nord America, dove crede di poter fornire il massimo valore ai clienti attraverso la sua piattaforma di marketing integrato.

Quad/Graphics, Inc. (NYSE: QUAD) ha anunciado un acuerdo definitivo para vender la mayoría de sus operaciones europeas a la empresa alemana Capmont GmbH por 41 millones de euros (aproximadamente 45 millones de dólares). La transacción incluye a todos los empleados y las instalaciones de Quad/Graphics Europe impresión y fabricación de tinta en Polonia, la agencia Peppermint en Varsovia y Quad POS con ubicaciones en toda Europa. Quad mantendrá las operaciones de impresión que respaldan su oferta de experiencia de marketing (MX).

Se espera que la venta se cierre a finales de 2024, lo que se alinea con la estrategia de Quad de optimizar su cartera comercial para crecer como una empresa de experiencia de marketing. Quad planea utilizar los ingresos para reducir la deuda e invertir en soluciones que avancen su oferta de MX. La empresa seguirá enfocándose en las operaciones en las Américas, particularmente en América del Norte, donde cree que puede ofrecer el mayor valor a los clientes a través de su plataforma de marketing integrada.

Quad/Graphics, Inc. (NYSE: QUAD)는 독일에 본사를 둔 Capmont GmbH에 유럽 사업의 대부분을 4100만 유로(약 4,500만 달러)에 판매하기로 한 최종 계약을 발표했습니다. 이 거래에는 폴란드에 있는 Quad/Graphics Europe 인쇄 및 잉크 제조 시설과 바르샤바의 Peppermint 에이전시, 유럽 전역의 Quad POS가 포함됩니다. Quad는 마케팅 경험(MX) 제공을 지원하는 인쇄 작업을 유지할 것입니다.

2024년 연말까지 마무리될 것으로 예상되는 이번 판매는 Quad의 마케팅 경험 회사로서의 성장 전략에 부합합니다. Quad는 수익금을 부채 감소와 MX 제공을 개선하는 솔루션에 투자하는 데 사용할 계획입니다. 이 회사는 통합 마케팅 플랫폼을 통해 고객에게 가장 큰 가치를 제공할 수 있다고 믿는 북미를 포함하여 아메리카 지역의 운영에 계속 집중할 것입니다.

Quad/Graphics, Inc. (NYSE: QUAD) a annoncé un accord définitif pour vendre la majorité de ses opérations européennes à Capmont GmbH, basé en Allemagne, pour 41 millions d'euros (environ 45 millions de dollars). La transaction inclut tous les employés et les installations de Quad/Graphics Europe impression et fabrication d'encre en Pologne, l'agence Peppermint à Varsovie et Quad POS avec des sites à travers l'Europe. Quad maintiendra les opérations d'impression qui soutiennent son offre d'expérience marketing (MX).

La vente, qui devrait se conclure d'ici la fin de l'année 2024, s'aligne sur la stratégie de Quad d'optimiser son portefeuille commercial pour favoriser la croissance en tant qu'entreprise d'expérience marketing. Quad prévoit d'utiliser les fonds pour réduire sa dette et investir dans des solutions qui feront progresser son offre MX. L'entreprise continuera de se concentrer sur les opérations en Amérique, en particulier en Amérique du Nord, où elle pense pouvoir offrir la plus grande valeur à ses clients grâce à sa plateforme marketing intégrée.

Quad/Graphics, Inc. (NYSE: QUAD) hat eine endgültige Vereinbarung angekündigt, die Mehrheit seiner europäischen Geschäfte für 41 Millionen Euro (etwa 45 Millionen Dollar) an das in Deutschland ansässige Unternehmen Capmont GmbH zu verkaufen. Die Transaktion umfasst alle Mitarbeiter und Einrichtungen von Quad/Graphics Europe Druck und Tintenherstellung in Polen, die Agentur Peppermint in Warschau und Quad POS mit Standorten in ganz Europa. Quad wird die Druckbetriebe aufrechterhalten, die seine Marketing Experience (MX) Angebote unterstützen.

Der Verkauf, der voraussichtlich bis Ende 2024 abgeschlossen wird, steht im Einklang mit Quads Strategie, sein Geschäftsinvestitionsportfolio für das Wachstum als Marketing Experience Unternehmen zu optimieren. Quad plant, die Erlöse zur Verringerung von Schulden und zur Investition in Lösungen, die sein MX-Angebot voranbringen, zu verwenden. Das Unternehmen wird weiterhin den Fokus auf die Geschäfte in Amerika legen, insbesondere in Nordamerika, wo es glaubt, den größten Wert für die Kunden über seine integrierte Marketingplattform bieten zu können.

Positive
  • Sale of European operations for €41 million (approximately $45 million)
  • Strategic focus on optimizing business portfolio for growth as a marketing experience company
  • Planned use of proceeds to reduce debt and invest in MX offering solutions
  • Retention of printing operations supporting the MX offering
Negative
  • Divestment of majority of European operations may impact global presence
  • Potential loss of revenue streams from divested European businesses

Insights

This sale of European operations is a significant strategic move for Quad. The €41 million ($45 million) transaction will help Quad streamline its operations and focus on its core North American market. The decision to divest aligns with the company's strategy to optimize its portfolio for growth as a marketing experience company.

Key financial implications include:

  • Debt reduction: Proceeds will be used to pay down debt, improving the company's balance sheet.
  • Reinvestment: Funds will also be allocated to enhance Quad's marketing experience (MX) offering, potentially driving future growth.
  • Geographic focus: By concentrating on the Americas, particularly North America, Quad aims to leverage its integrated marketing platform more effectively.

While the sale may result in a short-term revenue decrease, the long-term benefits of a more focused operation and improved financial flexibility could outweigh this. Investors should monitor how effectively Quad reinvests the proceeds and whether this strategic shift leads to improved profitability and market position in its core regions.

This divestiture represents a significant shift in Quad's global market strategy. By selling the majority of its European operations, Quad is signaling a strong commitment to its North American base and its evolution as a marketing experience (MX) company. This move could have several market implications:

  • Increased competitiveness in North America: By concentrating resources, Quad may strengthen its position against regional competitors.
  • Potential market share loss in Europe: While maintaining some presence, Quad's reduced European footprint might lead to decreased market influence in the region.
  • Shift in industry dynamics: This move may prompt other global players to reassess their geographic strategies, potentially leading to further industry consolidation or realignment.

The retention of strategic partnerships for global reach suggests Quad is adopting a more asset-light approach to international markets. This could provide flexibility but may also present challenges in maintaining consistent service quality across regions. Investors should watch for changes in Quad's client retention and acquisition rates following this strategic pivot.

SUSSEX, Wis., Oct. 22, 2024 /PRNewswire/ -- Quad/Graphics, Inc. (NYSE: QUAD) ("Quad" or the "Company"), a global marketing experience (MX) company, today announced that it has entered into a definitive agreement to sell the majority of its European operations for €41 million (approximately $45 million) to Germany-based entrepreneurial private capital investment manager Capmont GmbH ("Capmont").

Quad will maintain state-of-the-art printing operations in locations that best support its ever-evolving MX offering.

The transaction includes all employees and facilities for Quad/Graphics Europe print and ink-manufacturing headquartered in Wyszków, Poland; the Peppermint agency in Warsaw, Poland; and Quad POS (including Marin's International SAS), which has locations throughout Europe.

Excluded from the sale are Quad's shared services employees in Poland who support the company's integrated marketing platform in The Americas.

The transaction is expected to close by year end 2024 pending customary regulatory clearances and other closing conditions.

"The decision to divest the majority of our European operations supports our ongoing strategic focus to optimize our business portfolio for growth as a marketing experience company," said Joel Quadracci, Chairman, President and CEO of Quad. "We will maintain state-of-the-art printing operations in locations that best support our ever-evolving MX offering. This includes the Americas, with North America comprising our largest base of operations and where we believe we can provide the greatest value to clients through our uniquely integrated marketing platform. We will also continue to leverage strategic partnerships that enhance our ability to provide a seamless marketing experience around the globe."

Quadracci continued: "Over the years, we have made significant investments in our European operations and, today, have best-in-class equipment and capabilities, backed by knowledgeable, experienced employees. As we move forward with the sale, we are committed to facilitating a smooth transition for our employees who will continue to deliver the top-quality service our clients have come to expect."

Henrik Munte, Managing Director of Capmont, said: "Quad/Graphics Europe, Quad POS (formerly known as Marin's) and Peppermint are renowned for their best-in-class print, point of sale and marketing solutions. Empowered by highly dedicated and knowledgeable employees, we are convinced that the combination of the company's state-of-the-art production facilities and award-winning creative agency offers exceptional solutions for customers. We are highly appreciative of the successful cooperation with Quad throughout the transaction process. Capmont is very much looking forward to supporting the company on its path to becoming the European leader in print and integrated marketing solutions!"

Quad expects to use the proceeds from the sale to reduce debt and make further investments in solutions that advance its MX offering, consistent with its commitment to drive shareholder value.

Quad established its European print operations in 1998 through a partnership with Winkowski sp. z o.o. Quad acquired Winkowski in 2008, later renaming it Quad/Graphics Europe.

Quad purchased Marin's International SAS, a global leader in the point-of-sale display industry, in 2015, later renaming it Quad POS. The company specializes in the research and design of display solutions and uses several licensees to sell, manufacture and distribute its products.

AlixPartners served as Quad's financial advisory firm, and Eversheds Sutherland served as Quad's legal advisor.

About Quad

Quad (NYSE: QUAD) is a global marketing experience company that helps brands make direct consumer connections, from household to in-store to online. Supported by state-of-the-art technology and data-driven intelligence, Quad uses its suite of media, creative and production solutions to streamline the complexities of marketing and remove friction from wherever it occurs in the marketing journey. Quad tailors its uniquely flexible, scalable and connected solutions to clients' objectives, driving cost efficiencies, improving speed to market, strengthening marketing effectiveness, and delivering value on client investments.

Quad employs approximately 13,000 people in 14 countries and serves approximately 2,700 clients including industry leading blue-chip companies that serve both businesses and consumers in multiple industry verticals, with a particular focus on commerce, including retail, consumer packaged goods, and direct-to-consumer; financial services; and health. Quad is ranked among the largest agency companies in the U.S. by Ad Age, buoyed by its full-service Rise media agency and Betty creative agency. Quad is also one the largest commercial printers in North America, according to Printing Impressions.

For more information about Quad, including its commitment to ongoing innovation, culture and sustainable impact, visit quad.com.

Forward-Looking Statements

This press release contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements regarding, among other things, our current expectations about the Company's future results, financial condition, sales, earnings, free cash flow, margins, objectives, goals, strategies, beliefs, intentions, plans, estimates, prospects, projections and outlook of the Company and can generally be identified by the use of words or phrases such as "may," "will," "expect," "intend," "estimate," "anticipate," "plan," "foresee," "project," "believe," "continue" or the negatives of these terms, variations on them and other similar expressions. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results to be materially different from those expressed in or implied by such forward-looking statements. Forward-looking statements are based largely on the Company's expectations and judgments and are subject to a number of risks and uncertainties, many of which are unforeseeable and beyond our control.

The factors that could cause actual results to materially differ include, among others: the impact of decreasing demand for printing services and significant overcapacity in a highly competitive environment creates downward pricing pressures and potential under-utilization of assets; the impact of increased business complexity as a result of the Company's transformation to a marketing experience company, including adapting marketing offerings and business processes as required by new markets and technologies, such as artificial intelligence; the impact of changes in postal rates, service levels or regulations, including delivery delays; the impact of fluctuations in costs (including labor and labor-related costs, energy costs, freight rates and raw materials, including paper and the materials to manufacture ink) and the impact of fluctuations in the availability of raw materials, including paper, parts for equipment and the materials to manufacture ink; the impact macroeconomic conditions, including inflation, high interest rates and recessionary concerns, as well as cost and labor pressures, distribution challenges and the price and availability of paper, have had, and may continue to have, on the Company's business, financial condition, cash flows and results of operations (including future uncertain impacts); the inability of the Company to reduce costs and improve operating efficiency rapidly enough to meet market conditions; the impact of a data-breach of sensitive information, ransomware attack or other cyber incident on the Company; the fragility and decline in overall distribution channels; the failure to attract and retain qualified talent across the enterprise; the impact of digital media and similar technological changes, including digital substitution by consumers; the failure of clients to perform under contracts or to renew contracts with clients on favorable terms or at all; the impact of risks associated with the operations outside of the United States ("U.S."), including trade restrictions, currency fluctuations, the global economy, costs incurred or reputational damage suffered due to improper conduct of its employees, contractors or agents, and geopolitical events like war and terrorism; the failure to successfully identify, manage, complete and integrate acquisitions, investment opportunities or other significant transactions, as well as the successful identification and execution of strategic divestitures; the impact negative publicity could have on our business and brand reputation; significant capital expenditures and investments may be needed to sustain and grow the Company's platforms, processes, systems, client and product technology, marketing and talent, and to remain technologically and economically competitive; the impact of the various restrictive covenants in the Company's debt facilities on the Company's ability to operate its business, as well as the uncertain negative impacts macroeconomic conditions may have on the Company's ability to continue to be in compliance with these restrictive covenants; the impact of an other than temporary decline in operating results and enterprise value that could lead to non-cash impairment charges due to the impairment of property, plant and equipment and other intangible assets; the impact of regulatory matters and legislative developments or changes in laws, including changes in cybersecurity, privacy and environmental laws; the impact on the holders of Quad's class A common stock of a limited active market for such shares and the inability to independently elect directors or control decisions due to the voting power of the class B common stock; and the other risk factors identified in the Company's most recent Annual Report on Form 10-K, which may be amended or supplemented by subsequent Quarterly Reports on Form 10-Q or other reports filed with the Securities and Exchange Commission.

Except to the extent required by the federal securities laws, the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Investor Relations Contact

Don Pontes
Executive Director of Investor Relations, Quad
916-532-7074
dwpontes@quad.com

Media Contact

Claire Ho
Director of Corporate Communications, Quad
414-566-2955
cho@quad.com

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SOURCE Quad

FAQ

What European operations is Quad/Graphics (QUAD) selling?

Quad is selling Quad/Graphics Europe print and ink-manufacturing in Poland, the Peppermint agency in Warsaw, and Quad POS with locations throughout Europe.

How much is Quad/Graphics (QUAD) selling its European operations for?

Quad is selling the majority of its European operations for €41 million (approximately $45 million) to Capmont GmbH.

When is the sale of Quad/Graphics (QUAD) European operations expected to close?

The transaction is expected to close by year-end 2024, pending customary regulatory clearances and other closing conditions.

What will Quad/Graphics (QUAD) do with the proceeds from the European operations sale?

Quad expects to use the proceeds to reduce debt and make further investments in solutions that advance its marketing experience (MX) offering.

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