Steve D’Souza’s dream of turning Kalamazoo into a billion-dollar business may be dead with the Kiwi giant said to be in trouble.
D’Souza, the owner, told ProPrint that he remains in control of the New Zealand print group, and that its debt is manageable and it is not for sale.
However, his comments go against a tide of speculation coming out of the New Zealand printing industry. ProPrint has spoken to several well-placed sources who said the bank has become deeply involved, the bank has pushed D’Souza aside, and that Kalamazoo has held unofficial talks with selected parties about a possible sale or equity reorganisation.
None, however, would go on the record.
Kalamazoo chief executive Glenn Climo told Kiwi newspaper the Otago Daily Times last week that D’Souza “has taken a sideline in the day-to-day running of the company”.
However, D’Souza told ProPrint this morning: “I’m fully involved with the business. There are a lot of stories floating around. The truth will come out in a few weeks’ time.”
He also said the company’s debt position was manageable. “Our debt is far lower than most printing companies’ debt compared to their turnover ratio. It would be the best in the industry by far.”
D’Souza said competitors had spread false rumours because of the “massive restructure” Kalamazoo was undertaking.
[Get news first. Sign up for free news bulletins]
He said staff had been laid off, although he said he was unsure how many. However, he said none of the group’s 11 sites had closed. “We haven’t closed any sites as yet.”
D’Souza said Kalamazoo would overcome this “speed bump” and that he remained committed to the group. “I’m not a guy who will run away from my troubles,” he told ProPrint.
The question of paper supply remains unclear. BJ Ball chief executive Craig Brown declined to comment, while Paperlinx could not be reached for comment.
Multiple well-placed sources have told ProPrint that Fuji Xerox NZ would be nervously watching developments because Kalamazoo is a major customer. The numbers being thrown around are very large.
Fuji Xerox NZ had not responded to ProPrint‘s request for comment at the time of publication.
The PPSR registry shows that a host of leading suppliers have taken out a security interest against Kalamazoo and a related company, Kalamazoo Wyatt & Wilson.
The list includes BJ Ball, Blue Star NZ business Rapid Labels, Colorpak business Carter Holt Harvey Packaging NZ, DIC NZ, Fuji Xerox Finance NZ, Fujifilm NZ, Heidelberg Graphic Equipment, Hostmann-Steinberg NZ, Paperlinx NZ, Viscount Plastics NZ and Visy NZ.
Heidelberg Australasia managing director Richard Timson told ProPrint: “We are working very closely with Steve [D’Souza] and Glenn [Climo] and look forward to them readjusting their business so they’re a viable company going forward. They’re in full communication, which is really good.”
It is unclear how Kalamazoo’s predicament will affect Print Media Group. The Melbourne-based group is thought to have a partnership with Wickliffe New Zealand, which is owned by Kalamazoo. PMG director Leo Moio is away this week and could not be reached for comment.
[Opinion: Printers should register with PPSR]
D’Souza told ProPrint last year that Kalamazoo was turning over NZ$130 million, would reach NZ$250 million by 2014 and would hit NZ$1 billion in 2017.
He also said he had operated a “no redundancy policy” since acquiring Kalamazoo in 2005.
“Once I employ someone, I don’t make them redundant. We have not had any redundancies in our business since 2006,” he said at the time.
D’Souza joined Kalamazoo as a salesman in 2001. He acquired 50% of the company in 2004 and the other half in 2005.
Kalamazoo’s turnover that year was NZ$6.3 million, according to its 2004-05 annual report.
D’Souza then rapidly grew the company through a series of acquisitions, including Computer Forms in 2005, Raven Print in 2007, Wyatt & Wilson and Publishing Press in 2009, Wickliffe in 2010, Freestyle Artworks, Print Shop and Astra Print in 2011, and Taieri Print and K&M Print in 2012.
D’Souza told ProPrint last year that the company’s debts were well managed and that it was “the only printing company who the banks lend money to without thinking twice”.
“All my debts are paid off always in less than 30 months of a takeover. Also our debt-to-turnover ratio is perhaps the best in the industry by a long shot.”
[Feature: Avoiding the bad debt domino effect]
Kalamazoo New Zealand has no connection to Kalamazoo Australia based in Perth.
Comment below to have your say on this story.
If you have a news story or tip-off, get in touch at editorial@sprinter.com.au.
Sign up to the Sprinter newsletter
