Robert Aldridge, managing director, Aldridge Print Group
"Acquisitions are so circumstance-led. Will there be acquisitions in the next 12 months? Yes. Will they always be appropriate? Probably not. How many companies actually have the capital to buy a company? Whether an acquisition goes ahead depends on what the acquiring company is prepared to take onto the balance sheet. Sometimes the baggage is not considered the risk it can be, or often people see an acquisition as a way of increasing turnover and that isn’t a good idea. The thrill of placing the bet and winning the race is greater than the reality of the payout."
Nicholas Mockett, partner, Moorgate Capital
"I expect to see industry concentration, some of which will come from mergers and acquisitions and some from companies exiting by going out of business. Some distressed companies will be acquired as they may have reasonable kit, but not enough customers, or not enough cashflow and profit. Generally, difficult economic times will drive the concentration. Remember, we may have stopped shrinking, but you could argue that, even in the boom time, there was overcapacity and the lack of liquidity in the debt markets and the increase in capital gains tax may drive risk takers (shareholders) to sell up."
Andy Berg, managing director, FMG
"Print companies are likely to continue to look at mergers. There’s still overcapacity, so the benefits to be had from the economies of scale remain attractive. Even in pre-media, where the consolidation is further developed than in the commercial print market, there’s probably room for more. A lot of firms, regardless of what sector they’re in, are finding it tough and everyone can see the benefits of bringing two or even three companies into one. For some companies, I suspect there may be little option."
Vic Rollinson, sales director, Grapho Media
"I definitely expect there to be an increase in company mergers during the course of the next 12 months. I believe this is mainly down to the change that we are experiencing with the economic climate, but also I think it is down to the fact that many companies really need to look at their margins. On the other side of the coin, I think we will also see companies merging because they need to reduce their numbers in order to become more efficient as a business."
