PMP’s 100 per cent acquisition of Scribo will consist of an initial consideration of $21m in cash. Further consideration may be payable in 2011 under an earn-out arrangement linked to the performance of the business.

PMP says the acquisition brings the following benefits to PMP and GGA:

• Expanding GGA’s service offering from magazines to books

• Introducing a new set of retailers to the GGA network

• Expanding the reach of GGA’s retail network

• Increasing the product range for GGA with limited risk of revenue loss from existing lines

• Provides steady revenue stream, reducing the cyclicality of GGA business

• Expanding Scribo’s customer service offering to publishing clients of PMP’s Griffin Press Book Printing business

Brian Evans, chief executive officer of PMP says that the transaction follows the $80m acquisition of Times Printers Australia and represented a natural and logical extension into book distribution services.

He says, “The commercial logic and synergies underpinning this transaction are compelling. The book and magazine distribution industries share similar characteristics and terms and conditions, so there is a clear overlap in infrastructure and administration requirements between Scribo and Gordon and Gotch.”

Evans continues, “As we have stated, PMP’s strong capital position leaves us well placed to explore acquisitions of bolt-on capabilities, and we have found, with current market conditions, a growing number of prospective acquisitions are increasingly representing good value. Times Printers and Scribo are examples of the type of acquisitions we are targeting under this strategy.”

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