Industry reacts to PMP-IPMG merger

News of PMP’s planned merger with IPMG sent PMP’s share price rocketing by 37 per cent to 87 cents, however it has been a mixed reaction amongst the print industry.

Last week PMP revealed it had entered into an agreement to merge with IPMG, flagging challenges within Australia’s print industry as the cause of the consolidation.  

When the deal goes through PMP will acquire 100 per cent of IPMG, while IPMG owners the Hannan family will have a 37 per cent shareholding in PMP, valued at $119m.

PIAA CEO Andrew Macaulay sees the merger as positive news for the Australian print industry from an economic perspective.

“Clearly both organisations have been chasing volumes, the synergies of the merger will create one stronger business. It is good for print in Australia and the association is very pleased to see it proceeding,” Macaulay explains.  

“Both PMP and IPMG are chasing volume because there is currently more capacity than demand within the industry, which pushes down price and it means equipment is not being used at optimal levels. Mergers help rationalise the market and should bring some strength back into pricing.”

However, the Australian Manufacturing Workers Union warns the consolidation will cause job losses in the industry and says it will work to ensure union members receive proper representation.

Rival printing giant Blue Star has declined to comment on the merger, despite its own attempt to merge with IPMG in 2014 which was called off 72 days later. 

But fellow competitor Franklin Web chief executive, Phil Taylor comments, “It is good for the industry I think, but it is only early days.”  

Members of Australian Printer’s Facebook page reacted to the news using the ‘shocked’ and ‘angry’ emoji’s. 

PMP Print worker Glenn Bruniges commented on the post, “So glad we took a zero per cent pay rise for more transparency from management.” 

The deal is expected to be completed by January. The two companies tried to merge in 2001 but the ACC blocked it, however this time around with the explosion in digital marketing channels there is not expected to be much resistance.

 

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