CHAMP director, Nat Childres, says Blue Star was attractive to CHAMP for its market position, its experienced incumbent management team, excellent industry reputation, long term contracted revenue base, and outstanding sustained growth
Rounding out a year of frenetic M&A activity in the printing and media industries, mostly driven by private equity firms, Blue Star Print Group Limited (BSPG) was the subject of a buyout just before Christmas. The company announced December 20 that its shareholders had signed a conditional sale and purchase agreement with funds advised by CHAMP Private Equity in relation to the sale of all of the ordinary shares in BSPG. The transaction is expected to be settled on January 31 2007.
According to a BSPG statement, a number of adjustments to the purchase price are required be made on settlement but the transaction puts the enterprise value of the company at approximately NZ$385m (A$339.7m).
Following settlement, funds advised by CHAMP will own approximately 84 per cent of BSPG, while management and the current controlling shareholder and managing director, Tom Sturgess will collectively retain approximately 16per cent ownership.
BSPG has advised that, all of the existing senior management team will continue to be employees and shareholders of the business.
Upon settlement of the transaction, BSPG is expected to have a well capitalised balance sheet, with approximately NZ$100m (A$88.2m) of senior debt and NZ$105m (A$92.7m) of Capital Bonds, which were issued in late 2005.
Following the transaction BSPG expects to continue to satisfy the covenants of its Capital Bonds and BSPG advises that the Capital Bonds are not expected to be redeemed as part of this transaction.
"Blue Star is attractive to CHAMP not only for its leading market positions, but also because it has an experienced incumbent management team, an excellent industry reputation, a long term contracted revenue base, and outstanding sustained growth," says CHAMP director, Nat Childres.
The purchase of Blue Star will be CHAMP’s first acquisition in New Zealand. Managing director, Tom Sturgess, says the new owners wanted "business as usual" and that he welcomed the added financial and strategic support CHAMP would provide.
Goldman Sachs JBWere advised the shareholders of BSPG in relation to the transaction.
