In its first big win since acquiring Franklin Web in December, IVE Group has scored the multi-million dollar print contract for Coles Supermarkets monthly catalogue, formerly held by rival IPMG.
The company says, “Coles Supermarkets Australia Pty Limited (Coles) has awarded its catalogue printing services contract to Franklin Web (an IVE business) effective July 1 2017.
“IVE and Coles will now work co-operatively to develop a legally binding agreement and jointly undertake transition planning. It is intended that a binding agreement will be executed by February 2017.”
IVE revealed the $116m acquisition of Franklin Web in early December in a bid to expand the company into the large format web offset sector and bolster its current offering to the retail sector.
Its main catalogue printing rivals are PMP and IPMG, which are also planning a mega merger that is currently being reviewed by the Australian Competition and Consumer Commission (ACCC).
However the ACCC has expressed caution over the deal in a statement made last month expressing what it says are ‘initial concerns’.
Its preliminary view is that ‘the merger may substantially lessen competition in the supply of heatset web offset printing’.
If the PMP/IMPG deal does go through, this would leave only two major players in the catalogue printing sector with over 90 per cent dominance in the market.
While the Coles contract is considered a big win for IVE, the supermarket giant has recently been slashing its print advertising spend by cutting more than half its spend in magazines and newspapers.
The first two months of 2016 saw Coles allocate around $50,000 per week for its print budget, plummeting from 2015’s average of $150,000 per week in January and February.
However, Coles has invested heavily in its free self-titled monthly print mag with its print run of 1.5 million copies per month vying with the Woolworth’s magazine for the biggest magazine in the country.
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