Australia’s magazine and catalogue printing industry is in flux with the collapse of Ovato, for which expressions of interest are sought this week.
It had been hoped that a speedy sale of its book printing division – the former Griffin Press business – to Hong Kong-owned Opus would have enabled Ovato to trade out of its difficulties without the administration.
Now administrators FTI Consulting have called for expressions of interest to buy it by this Friday (July 29) although they are continuing to operate the business “as usual” in the meantime. Interested companies – bidding for Ovato or parts of it – should register their interest by July 29, and be able to make a binding offer by August 11. FTI hopes to sell the business as a single unit, although its New Zealand arm might be split off.
A “public sale and recapitalisation” process is also planned, with trading in Ovato’s shares suspended during the administration. A meeting of creditors is planned for early August.
Sale of Ovato’s book printing division to Opus Group for $8.5 million was approved by the Australian Competition and Consumer Commission on the basis of its “likely imminent insolvency” if the transaction did not proceed.
The Hong Kong owner of Opus is a possible contender to purchase the remaining business, as is Mercury Capital, the private equity fund which owns magazine publisher Are Media and already has shares in Ovato having recently purchased its retail distribution arms.
Real estate occupied by Ovato is understood to be privately owned, while the position regarding press and mailroom equipment is not clear. In its advertisement, FTI also mentions the existence of “secure supplies” of web and sheetfed paper in the disrupted market. Interested parties should contact Drew Forbes at FTI Consulting, drew.forbes@fticonsulting.com or call 0410 697 715.
Following industry consolidation, Ovato was one of two major heatset printers remaining in the Australian marketplace, the other being Ive Group.