DATA Communications Management Corp. (TSX: DCM) has agreed to acquire Calgary based BOLDER Graphics for $4.9 million.
The consideration is comprised of $2.0 million payable in cash on closing (net of shareholder loan repayments and transaction expenses), $1.0 million through the issuance of common shares of DATA, $0.9 million in the form of a subordinated, unsecured 6.0% interest-bearing vendor take back note to be payable over a 24 month period, and the assumption of approximately $1.0 million in outstanding long term indebtedness.
BOLDER is a leading western Canadian marketing communications business, tracing its roots back more than 40 years. Its core capabilities are in large-format digital printing, offering point of sale signage, corporate packaging, outdoor signage and vehicle graphics. BOLDER also specializes in loose-leaf bindery and stationery and other commercial print capabilities. The company has approximately 40 employees operating in a 59,000 square foot facility located in Calgary, Alberta.
BOLDER generated approximately $7 million in revenues (unaudited) for the fiscal year ended January 1, 2017. DATA intends to relocate BOLDER’s staff and operations into DATA’s 165,000 square foot Calgary, Alberta facility, which produces a wide array of sheet-fed lithography, digital and wide format print services, variable print-on-demand solutions and provides warehousing, fulfilment and distribution services.
To fund the acquisition, DATA has arranged a new $5 million senior credit facility with Integrated Private Debt Fund V LP, and its general partner, Integrated Private Debt Fund GP Inc., the private debt management division of Integrated Asset Management Corp. (TSX: IAM).
DATA has been backed by Integrated Private Debt Fund IV LP and the company amended the term loan agreement with Integrated Private Debt Fund IV in connection with the acquisitions of Eclipse Colour & Imaging Corp. and Thistle Printing Limited in January 2017. Integrated Private Debt Fund III LP holds an $8M loan in DATA, as result of DATA’s acquisition of Thistle Printing.
“We are pleased to welcome the BOLDER family to DATA,” said Michael G. Sifton, CEO of DATA. “BOLDER’s customer base of leading western Canadian retailers and other brands will benefit from our own capabilities in Calgary as well as our national footprint and technology solutions. This acquisition further strengthens our large format presence in the market and is expected to provide immediate synergies when combined with our state-of-the-art Calgary centre of excellence.”
Kevin McCoy, President & CEO and founder of BOLDER, is expected to remain with the company for approximately six months to assist in transition matters. Dave Watt, Vice President, Sales and Marketing will remain with the company and continue to serve BOLDER’s clients.
The acquisition is expected to close on or about November 10, 2017 and is subject to customary closing conditions.
photo credit: BOLDER Graphics