Baldwin goes private in acquisition by investment firm

Baldwin supplies press accessory and control equipment systems for the newspaper printing industry as well as cleaning products, UV-curing systems, water management, IR and hot air drying systems and other tools for commercial printers.

In an interview with PrintWeek in the US, Baldwin chief executive Mark Becker (pictured) explained the company has been working aggressively to resize its global platform to reflect the changes in commercial printing.

“We still have a great brand and a great business future, but have been having difficulty refinancing our main credit facilities,” he added.

“By entering into this transaction we’ve eliminated the challenge of finding capital in a tight market. We’ll be staying independent under this deal so there is no change to staffing or organisation.

“There’s no new debt. The capital structure of the company after the closing will be determined by the new owners, but it’s not a high-leverage deal or anything like that.”

Becker, who took his role in late 2010, added that part of that challenge is that many banks have a negative view of commercial printing these days – a view shared by the investment community. Baldwin stock traded as high as USD1.78 a share last May, but dropped to 47c a share in late December.

As part of the deal, Forsyth – through a newly formed subsidiary Forsyth Baldwin LLC – has proposed to pay 96c a share for the company. That could change but as part of the agreement it won’t drop below 90c a share.

Becker said that Baldwin, as a publicly traded company, is legally obligated to consider competing bids through to 28 January, adding, “We feel that the offer being presented is a more than fair, but we’re open to other offers.”

He explained that for a small company, the overhead costs of being a public company, such as complying with all regulations, were fairly onerous.

Assuming it does not receive any competing bids, the deal with should close sometime in the next quarter.

“We have reached out to all of our major global customers and pointed out this is a great move for Baldwin – it keeps us independent and they’ll be working with the same team,”  Becker said. “The feedback that we’ve received so far has certainly been positive.”

Baldwin reported a loss of USD12.1m for its most recent full fiscal year, which ended 30 June2011, on revenues of USD160m, compared with a profit of USD3.5m in the previous fiscal year.

This article originally appeared at printweek.com

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