News Archives
June 2000
June 30, 2000
St. Joseph to build new plant near Ottawa
GLOUCESTER, Ont. — St. Joseph Corp. CEO Tony Gagliano says the company is in the process of purchasing a 16-acre parcel of land from the City of Gloucester, just outside Ottawa. In an interview yesterday, Gagliano said city council approved the sale on Tuesday night. The company intends to build a 200,000 sq. ft. facility into which it will consolidate the operations of M.O.M. Printing (acquired in February) and the commerical printing division of its Canada Communication Group (acquired in 1997). Gagliano said the new plant could be operational as soon as the first quarter of 2003.

PLM to go for quality rating
MARKHAM — PLM CEO Barry Pike said yesterday in an interview that his company has undertaken significant internal restructuring efforts this year and will be in a strong position to catalogue operational procedures as required by ISO 9000 auditing bodies. The ISO 9000 series of quality ratings require that a company establish best practices throughout the production and/or service process, commit them to print in the form of manuals, and stick to them. Although it was only officially established in 1987, the origins of the ISO bureaucracy can be traced to World War II efforts to harmonize Allied ammunition specifications, notes ISO consultant Peter Merrill.

June 27, 2000
No offers for Cosgrove-Moore
TORONTO — Cosgrove-Moore Bindery Services, which went bankrupt 15 days ago, will likely be sold in chunks. “No one has stepped forward [with an offer to buy the company],” confirmed bankruptcy receiver team member Ken Pearl of Deloitte & Touche. “Plan B” was being initiated yesterday: newspaper ads will appear in The Globe & Mail this week inviting bids on various lots of assets such as binders, work vehicles and office machines. The ads will also appear in papers in the Michigan area where Cosgrove had a presence. Pearl said only a “handful” of Cosgrove's 165 staff remain at the company’s 136,000 sq. ft. facility on Birchmount Rd. The company’s 17 folders, perfect binders and saddlestitchers have been idled. Should Plan B fail to liquidate all assets, Pearl said “Plan C” is a full public auction. The liquidation process is expected to carry on for the next three to four weeks, Pearl added.

Canadian union leader becomes chief recruiter
TORONTO — Duncan Brown, who was acclaimed international vice president of the Canadian division of the Graphic Communications International Union on June 4, has also been appointed director of organizing for the GCIU throughout North America. The GCIU has 18,000 members in Canada and 120,000 stateside. Brown will oversee the GCIU’s efforts to increase union membership in both countries. The appointment was made earlier this month at the GCIU’s general board meeting in Washington, D.C. One area considered particularly ripe for organizing, unions leaders say, is new media companies.

June 23, 2000
Reliable seeks U.S. expansion, not Cosgrove
TORONTO — Reliable Bookbinders owner David Johnson says he’s not interested in purchasing Cosgrove-Moore Bindery Services, which went into bankruptcy on June 12. While Johnson said he might be interested in purchasing some of his old rival’s equipment, he’s concentrating now on the feasibility of U.S. expansion—something Cosgrove-Moore was examining before it went bankrupt. Johnson said a decision would be made on that matter by year’s end. As for Cosgrove-Moore, CEO Carey Moore is no longer with the company. Receiver in bankruptcy Catherine Hristow of Deloitte & Touche evidently prefers not to return calls.

Arthurs-Jones Clarke jettisons in-house binder
MISSISSAUGA — A saddlestitcher and three 2-colour presses have been sold off by Arthurs-Jones Clarke Lithographing. Seven workers were consequently released. While the company will keep its suite of cutters and folders, CEO Emilio Ciampini said time and money could be saved by outsourcing to trade binderies. As for the presses— a 29” 2-colour and two 40” 2-colours inherited when Clarke Lithographing bought Arthurs-Jones for $14.8 million 18 months ago—Ciampini said he originally envisaged that there would be enough 2-colour work to keep them fed. Turns out people want more colour these days, he said, and sending jobs through twice was “not practical.” Ciampini said a U.S. broker bought the saddlestitcher for a client in Korea.

Crain-Drummond sold
BOUCHERVILLE, Que. — Reynolds & Reynolds of Dayton, Ohio, has sold subsidiary printer Crain-Drummond with its Information Services Group (ISG) for US$360 million. The management-led buyout was announced Tuesday. Majority equity partner (90%) is Washington, D.C.-based The Carlyle Group, a private global investment firm with US$10 billion in equity positions in various companies including telecommunications, defense and information management firms. "It's a great piece of news for our North American organization," said Crain-Drummond CEO Mohamed Yacoub after the deal was signed.

June 20, 2000
Grenville to buy floundering rival
MARKHAM, Ont. — Grenville Printing & Management Ltd. of Toronto is on the verge of buying deeply indebted, high-tech rival Nortec Colour Graphics, PrintCAN has learned. Grenville Printing president Bill Burke was not available for comment. Nortec CEO Shaun Bernard would neither confirm nor deny the rumour when contacted yesterday. “I’m under a veil of silence here,” he said, adding that an announcement of some sort could be made within the next 10 days, following the completion of due diligence protocols. Bernard and three others founded Nortec last fall, with the bulk of it’s estimated $10 million in sales coming from CD package printing. Millions were invested in Nortec’s state-of-the-art CTP operation in Markham, with prepress, press and bindery digitally linked via CIP3 technology. Sources say Nortec’s Heidelberg equipment suite—including a 10-colour perfector press, an 8-colour 29” and a 2-colour Speedmaster—had lately been operating at an unsustainable 30% capacity with Nortec unable to drum up sufficient sales beyond its music industry clients. A notice of intention to restructure operations was recently sent out to creditors. Secured creditors include Heidelberg. Sources say Grenville, which had commercial printing sales last year of about $20 million, is planning to move into Nortec’s 50,000 sq. ft. Markham plant and will be the sole equity owner.

Crain-Drummond sale imminent
BOUCHERVILLE, Que. — The sale of package/label/forms printer Crain-Drummond—Canada’s ninth largest printer with sales of $200 million last year—will likely be announced later this week, says CEO Mohamed Yacoub. Crain-Drummond is a division of Reynolds and Reynolds Co. of Dayton, Ohio, which decided in April to sell its Information Services Group (sales $1 billion) of which Crain-Drummond is a part. “We are down to the final strokes,” Yacoub said during a recent interview. “We have the best bidder and we’re trying to finalize that deal.” Crain-Drummond was established in 1894.

June 16, 2000
Cosgrove-Moore descends into bankruptcy
TORONTO—Canada’s largest trade bindery was shoved into bankruptcy on Monday by disgruntled creditor Bank of Nova Scotia which is owed $2 million. The bankruptcy proceeding was triggered late last week following the collapse of a $2.85-million bridge financing deal the company signed with Markham-based lender Century Services Inc. According to one source, the deal fell apart because Century slapped Cosgrove-Moore with additional fees to which the company objected. Century’s Dale Duffy, who worked on the Cosgrove deal, declined to be interviewed yesterday. “I can’t comment,” he said when asked about the alleged fee-slapping. Cosgrove CEO Carey Moore was not returning calls yesterday nor was the receiver from Deloitte & Touche. Bankruptcy trustee Darryl McConnell of BDO Dunwoody said yesterday that the aborted “mezzanine financing” with Century represented an “adverse material change” with respect to Cosgrove-Moore and provided the Bank of Nova Scotia with a window of opportunity to make an application to a court judge on Monday to terminate the protective bubble Cosgrove had been enjoying since March 3 under section 69 of the Bankruptcy and Insolvency Act. “The result was the deemed bankruptcy of the company,” said McConnell. A source says Cosgrove had arranged an alternative financing deal but the judge’s decision precluded its consummation. Sources say the company and its 150-plus employees, which had sales last year of $11 million, are finishing jobs on the floor but aren’t taking on new work. The company may be sold as a going concern. Nearby competitor David Johnston of Reliable Bookbinders Ltd., is rumoured to have expressed interest in Cosgrove-Moore in the past, but he wasn’t available for comment yesterday.

Large-format printing alliance
TORONTO—Richmond Hill, Ont.-based MGI Software and Toronto-based GIS Global Imaging Solutions have formed a multi-year partnership to deliver large-format digital printing solutions to businesses and consumers, including posters, prints and banners. Citing a study by CAP Ventures, the companies note that digital printing is expected to grow from $15.5 billion in 1997 to $47 billion by 2002—a growth rate that’s five times higher than that of traditional offset printing.

June 13, 2000
Herald pressmen return tomorrow
CALGARY — More than 100 press operators and mailroom staff at the Southam-owned daily Calgary Herald will return to work tomorrow. Collective agreement negotiations between the Graphic Communications International Union and Herald management collapsed on May 2 when management declared a lockout. The GCIU went on strike a few days later. Talks resumed and were successfully concluded three days ago. The new four-year collective agreement accords press operators a 3% raise in the first year and a 2.5% raise each year thereafter. During the lockout, the Herald’s Goss presses were operated by crews of replacement workers, plucked mostly from the Herald’s management corps but also from other Southam-owned printing plants, one of which is rumoured to belong to the Ottawa Citizen. Herald publisher Dan Gaynor declined to confirm the Citizen link during an interview yesterday, saying only that “five or six” pressmen were recruited from off-site operations.

June 9, 2000
Creo buys Toronto software company
VANCOUVER — Creo Products announced earlier this week the purchase of Toronto-based Carmel Graphic Systems for about $12.5 million in cash and stock. The deal closed May 12. Carmel designs View-IT and Submit-IT proofing software which will be incorporated into the browser-based Prinergy InSite proofing and job-tracking system.

June 6, 2000
Printer pays neighbour $30k to move
VANCOUVER — Business has been booming for Metropolitan Fine Printers but president and owner George Kallas was running out of space. Next to his 12,000-sq.-ft. plant was an 8,000-sq.-ft. tarp factory. When the owner declined Kallas’ $20,000 offer to move operations so he could lease the space to accommodate his growth strategy, Kallas offered $30,000. The tarp maker accepted and about a month and a half ago, Kallas put the finishing touches on the building he gutted and converted into his post-press facility. “It was either them or us,” laughs Kallas, who founded Metropolitan in 1977 and has grown it into the greater Vancouver area’s ninth largest printer with sales last year of $11 million on 47 employees. Recent equipment upgrades include a $5 million 8-colour MAN Roland 700 with perfector and a used $750,000 6-colour MAN Roland 100. Kallas noted that he recently hired a pressmen and sales coordinator from now-bankrupt Hazeldine Press, and that he expects sales to approach $13 million this year.

Creo buys Adobe plug-in software firm
VANCOUVER — Intense Software Inc., a Vancouver firm founded in 1995 which develops enhancement software for graphics companies using Adobe's Photoshop, Illustrator and Acrobat programs was purchased last week by Creo Products for US$16 million (US$1 million in cash and 467,654 Creo shares valued at US$32.) Creo gains access to Intense's 50 distributors worldwide. Intense turned a profit last year on sales of US$1.35 million, said Creo investor relations officer Tracy Rawa. All Intense products will be rebranded with the CreoScitex marque.

June 2, 2000
Innova envelopes Regional
MARKHAM, Ont. — If you can’t beat ‘em, buy ‘em. Innova Envelope, a division of Supremex, itself a division of gargantuan U.S. consolidator Mail-Well, has tabled an offer to buy out long-time rival Regional Envelope Products—and its parent company CML Industries— for approximately $30 million. The sale is pending review by the federal Competition Bureau, which should render a decision by August. Combined, the two companies would control roughly 75% of the envelope market in Ontario and Quebec, said Regional president and CML principal Gerald Charbonneau during an interview Tuesday. The rivalry began when Charbonneau resigned from Innova in 1987 and quickly launched Regional, which he sold a year later to CML, a publicly traded company which also owns Precision Papers Ltd., Transit Envelope of Montreal, Specialty Filing Ltd. and two Peterborough, Ont.-based companies— Regal Envelope and Specialty Paper. Last year, Regional’s sales accounted for 76% of CML’s total revenue of $46 million. Charbonneau said he was delighted with the premium buy-out offer. “We couldn’t get much bigger in the Canadian market,” he said, adding he’ll stay in the printing industry but that a non-comp agreement precludes him from pushing envelopes.

“Bench strengthening” executive shuffle at St. Joseph
CONCORD, Ont. — John Gagliano is coming home. Formerly VP and GM at St. Joseph Ottawa/Hull and St. Joseph M.O.M., Gagliano—brother of St. Joseph CEO Tony—returns to head office to become VP and GM of St. Joseph’s showpiece Concord facility. He is succeeded by Rob Young, formerly Sr. VP of Sales and Operations at the Concord plant. Young, who speaks English and French and has lived in Ottawa prior to this promotion, will travel to Ottawa and return to Toronto on weekends. Tony Gagliano said the shuffle will increase the depth of experience at the management level. “You always want to strengthen your bench,” he said.
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