The purchase of McMillan has rocketed the Blue Star Print Group to the top of the sheetfed print league, Wayne Robinson asks MD Geoff Selig what’s going on.
The seemingly insatiable desire for private equity to buy into the Aussie print industry shows no signs of diminishing, with trans Tasman Blue Star Print Group buying one of the country largest remaining independent printers JS McMillan, (including Canberra's Pirion), and Canberra's biggest printer NCP in the last month, and these won't be its final purchases. And to show it isn't just growing through acquisition the diverse group also fronted the not inconsiderable amount of cash for a pair of Fuji Xerox iGen3s to significantly up its digital presence in its Sydney and Melbourne heartlands.
The purchase of McMillan and NCP came just a year after Melbourne's Print and Vision became part of the group, (it has sinced merged with Cratfsman Press at the latter's Port Melbourne production centre), and is just six months after the 55 Laser mailing operation, also in Melbourne, was bought. It also comes after Blue Star became Heidelberg ANZ's biggest customer, spending big on a series of mainly long perfectors for its print operations.
For managing director Geoff Selig there is nothing particularly remarkable about these activities, he says, "Buying successful print operations and investing in high quality production technology is a part of our well declared growth strategy. We are building a business to meet the requirements of our customers and the developing market, our growth will come organically and through acquisition - when the fit is correct."
Blue Star is focusing on print, including web, sheetfed and digital, mailing, logistics and print management for its future. It aims to replicate its operations in Sydney and Melbourne, with smaller scale operations in other major centres, such as Canberra, for NCP is not just a printer, it has a mailing and warehouse operation as well, in fact with Pirion Blue Star now has Canberra pretty much tied up. The McMillan purchase is unlikely to the Group's last, Selig says, "It would be a fair assumption that a Brisbane production centre is not far from our thoughts now." Before Brissy's printers either run to Selig's door or try and hide their businesses away from him it should be noted that the businesses Blue Star buys have to be a clear strategic fit. And Blue Star tends to hang on to the former owners and let them continue to run their companies, albeit under strong guidance from Selig and his management team.
It's not just Blue Star of course that is buying up, the other Trans Tasman private equity backed group Geon is just as prolific in its spending, and other printers are also teaming up, Lithocraft in Melbourne recently bought Lynch Print for instance, and of course transactional printer Salmat is thought to be in the box seat to buy its main rival HPA. Selig says, "Industry consolidation will continue, and as technology converges so will businesses, simply because it will make sense."
As far as Blue Star is concerned technology is one of the key's to future success, but the company is positioning itself to make sure it is meeting the customer needs, Selig says, "Whether the message is communicated by web offset, sheetfed or digital or electronically, what is important is that the needs of the customer are being met, and exceeded. Our business is aiming to be able to deliver a multi channel campaign. We certainly don't see digital as a threat to offset but complimentary to it."
For Blue Star having a strong digital capability is essential, and is highlighted by the two new iGen3s. Selig says, "We want a full variable date digital colour printing capability. We will be seeking new business for the iGen's but we will also be transitioning offset jobs where appropriate, and we are already handling a fair amount of generic digital print."
For Selig the increasing sophistication of databases and the rapidly growing awareness of marketers in regard to variabnle printing stacks up to a compelling argument for profitable digital print, he says, "There is high value in personalised targeted direct mail, the analysis stacks up, it is very effective. The marketing people are pleasantly surprised by how sophisticated the technology is. This in turn highlights just how valuable the data is they have, and shows them how they can maximise that value."
Liker an increasing number of domestic printers Blue Star is engaging with China, Selig says, "China is an extension of the supply chain. We engage a lot of suppliers, and China is an option that sometimes adds up."
The Blue Star Print Group now has revenues of A$500 million, its trans Tasman operations include sheetfed printing, web offset printing, label printing, mailing services, logistics, print management and supply chain services. BSPG employs over 1800 staff within three divisions and a labels business.
Its portfolio of established brands, including McCollams, Nicholsons, Format, Printlink, Securacopy, Webstar, Rapid Labels, BSP Integrated Solutions and BSP Logistics in New Zealand and Link Printing, Kings Mailing, Craftsman Press, Webstar, BSP Integrated Solutions, BSP Logistics, NCP, Pirion and McMillans in Australia, the company services a diversified customer based in both countries.
Clients include agencies and departments of the New Zealand government and many of Australia and New Zealand's leading corporates and financial institutions. Over the past five years, it has undertaken an extensive $100m capital expenditure programme that has resulted in modern technologies across all business units.
Champ and its ilk are putting in an awful lot of money, into what some commentators believe is a market sector, print, that has already peaked and is set for decline in the face of the electronic onslaught, however Selig says, "We have no worries about the print market. It is very large, far larger than most people realise, the opportunities are immense for companies that can position themselves to meet the growing communication requirements of the commercial world and can present and deliver high value propositions to the market", and you certainly can't argue with that.
