For the ink industry, the past year was relatively calm after an active period culminating in drupa 2016. Mergers and acquisitions slowed, as companies integrated recent purchases and formed new divisions. However, there are changes ahead as the supply chain upstream and downstream undergoes more mergers.
The biggest M&A news was Sun Chemical’s acquisition of Flint Group’s European publication gravure ink business. The sale, which was announced in August 2016 and completed in October, is the only deal in recent memory between the two largest international ink companies.
For Sun Chemical, the move allows the company to add customers and augment its product portfolio. For Flint Group, selling the publication gravure business in Europe allows it to increase focus on its core web offset markets. It also shows the changing nature of the publication gravure ink market in Europe, as Sun Chemical and Siegwerk now dominate the segment.
On the supply side, there have been huge billion-dollar deals. In early January, Evonik completed the acquisition of Air Product’s Performance Materials Division for $3.8 billion. Lanxess purchased Chemtura in April 2017. In May 2017, Clariant and Huntsman announced plans for a merger of equals. The largest of all mergers is nearing completion, as The Dow Chemical Company and DuPont are set to complete their own combination in August 2017, forming a company with combined sales of more than $75 billion.
On the customer side, RR Donnelley successfully split into three companies. WestRock divested its Home, Health and Beauty business for about $1 billion to Silgan, while acquiring Multi Packaging Solutions. On the substrate side, International Paper bought Weyerhaeuser’s cellulose fibers pulp mills for $2.2 billion.
Consolidation is occurring throughout the supply chain, which makes the coming year that much more of a challenge for the ink industry. For ink manufacturers, navigating these changes profitably will be critical to their success going forward.
|Company||Global Ink Sales (Parent)|
|8||Fujifilm North America||$400M*|
|9||Tokyo Printing Ink||$390M|
|13||Yip's Chemical Holdings||$205M|
|16||Royal Dutch Van Son||$130M*|
|17||Sanchez SA de CV||$101M|
|18||Marabu GmbH & Co. KG||$100M*|
|* Ink World estimate|