Leominster Plant Braces For Merger | Effects of World Color acquisition unknown
The parent company of Worldcolor Eusey Press Inc. in Leominster is slated to get a new owner by the end of the summer, and the local business community is waiting for news about what that will mean to the 200 or so people who work there.
“I’m sure the employees are anxious, because that’s just the situation whenever there’s a change in ownership,” said David McKeehan, president of the North Central Massachusetts Chamber of Commerce.
“When you look at what’s going on across a number of industries — and the print industry I think in particular — there’s reason for concern.”
McKeehan said the purchase of World Color Press Inc. by Wisconsin-based Quad/Graphics is just the latest in a series of changes at the company that have had people in the area biting their nails over the years.
He said Eusey Press was a well-known locally owned business until it was bought by the Canadian company Quebecor World Inc.
From The Ashes
According to company financial filings related to the acquisition, Quebecor was hit hard over the past decade by declining sales and then by the global credit crunch and recession.
It went into bankruptcy in 2008, emerging in 2009 with the new name World Color Press Inc.
The merger of World Color into Quad/Graphics will mean the creation of a big new player in the printing industry.
Quad/Graphics, which prints magazines, catalogs and other materials for clients including Conde Nast, Hearst Magazines and other major publishers, is privately held and employs about 11,600 people in the U.S., South America and Europe, according to financial filings.
World Color, which trades on the Toronto Stock Exchange, prints a similar array of materials for clients that include Wal-Mart Stores Inc., Harlequin Enterprises Ltd. and The Reader’s Digest Association Ltd.
The Leominster facility prints books, including user’s manuals. World Color is the second-largest commercial printer in the U.S. and in Canada, and it has operations in Latin America.
After the acquisition, Quad/Graphics plans to go public, trading on a U.S. exchange to be determined.
Reducing Redundancy
Neither company is commenting about what the merger will mean for individual company sites, but Quad/Graphics says in its financial filings that the acquisition could save $225 million a year through consolidation and increased efficiency.
McKeehan said it’s hard to predict how the acquisition might affect the Leominster facility.
He said he expects that the company will be looking at the capacity of equipment and productivity at all its locations, as well as the cost of relocating operations and many other factors.
McKeehan said Quad/Graphics probably already has plans in mind for its first moves toward consolidation, which could go into effect as soon as the deal is final.
But even if Leominster isn’t touched by the first round of cuts, he said, the company will continue making changes as it settles into its new shape and adjusts to market conditions. To find out whether that will be good or bad for Leominster, local observers will just have to wait and see.
“Those are the unfortunate realities of business,” McKeehan said.
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