As the ink industry closed the books on 2004, there were some signs that 2005 would be much different than the previous few years, beginning with the sense that sales rose at the end of 2004. There were also much-needed price increases implemented by ink manufacturers in response to the drastically rising raw material costs they were facing.
There were even some moves on the M&A front, particularly the acquisition of BASF Printing Systems and ANI Printing Inks by CVC Capital Partners. In addition, the gains being made in digital technologies have been spurring growth for printing ink manufacturers.
Through the first few weeks of 2005, there are indications that these trends are continuing. More price increases have been announced by key suppliers, and there has been no sign that the increases announced by ink manufacturers have been uniformly rolled back.
There has also been a major announcement on the acquisition front. Fuji Photo Film Co., Ltd. signed an agreement Jan. 19 to acquire Sericol for $230 million from an investment group led by Saratoga Partners, with the deal expected to close in late February.Sericol’s current management, including chief executive Ed Carhart, will remain with the company.
Sericol has 1,200 employees worldwide, and had estimated sales of $275 million in 2004. Sericol is a world leader in the production of inks and other consumables for the screen-printing and narrow web industries. It has also aggressively expanded and taken a leading position in the wide format digital ink market, and is a technology leader in UV screen, flexo and digital inks. It was Sericol’s growth in digital technologies that was one of the catalysts to the acquisition.
More signs on how the ink industry is faring can be found in The Milling Report, beginning on page 18, and Vehicles and Varnishes, starting on page 23. In The Milling Report, some leading milling manufacturers report that there were gains in 2004,and that there is strong interest in process improvement.
In Vehicles and Varnishes, key suppliers discuss the ramifications of the price increases they are facing, as well as the importance of partnering with their ink customers.
All in all, it has been a very active beginning to 2005, and we shall all see what else is in store as the year continues.