The transaction excludes the printing plate manufacturing activities in Barcelona, Spain, which are likely to be shut down according but includes the IPAGSA plant in China. The company’s press release states that the printing plate volumes to be acquired will be partly integrated in Agfa’s global manufacturing network and partly procured from third-party suppliers. It is expected that in 2019, this acquisition will contribute up to EUR 30 million to Agfa Graphics’ top line with a double-digit EBITDA.
“This acquisition is another step in our strategy for profitable growth. Next to a significant increase of our prepress top line, the acquisition will also help Agfa achieve its EBITDA target of 10% in average over the next few years. Ipagsa’s experienced team will continue to operate under its own brand as a separate entity, managed by its current owner, Lorenzo Ferrari,” says Stefaan Vanhooren, president of Agfa Graphics.
The China and India strategy
Consolidation and strategic alliances, which are often a precursor to consolidation among print equipment and consumable suppliers, continue apace. At the end of August, Agfa announced a strategic alliance agreement with Chinese offset plate manufacturer Lucky HuaGuang Graphics. Under the intended collaboration, Lucky HuaGuang Graphics will provide manufacturing capacity for printing plates in Nanyang, China, with Agfa Graphics’ support and using Agfa Graphics’ high-end technology and intellectual property to manufacture products for Agfa.
Apparently, Ipagsa plates will be separately branded and sold to more price-sensitive markets while the premium segment plates will be branded as Agfa Graphics plates. It is not clear how this will impact the Indian market or whether the Ipagsa plates will be made at the IPAGSA plant in China or by Agfa’s strategic ally in China, Lucky HuaGang or even by TechNova in India. Agfa’s strong licensee manufacturer and distributor TechNova is based in the Mumbai region and dominates the Indian offset plate market with no significant local manufacturing competition. Since the Agfa press release states that the Ipagsa plate manufacture will be integrated in the company’s global network, it is possible that these could be manufactured by TechNova at some point. Watch this space.