Opus invests $8.5m to buy Ovato books
Opus Group is buying the Ovato book printing business for $8.5m, and is making a further $2.5m investment in Ovato, in the form of a convertible note due to mature in 18 months’ time.
Opus will keep the book printing business – formerly known as Griffin Press – in its current Adelaide location, with the aim to keep all 80-90 staff and the equipment. Richard Celarc, CEO of Opus said, “It is an excellent facility, and complements our book plants at McPherson's and Ligare well, they all have their specialities.
“Book manufacturing is returning to Australia, partly because of the shipping crisis, and Opus is in an excellent position to give book publishers what they want. We aim to drive local manufacturing.”
Opus Group sources the majority of its paper for books from local mills in Maryvale and Tasmania.
Opus is owned by Hong Kong based Left Field Print Group, which two months ago pumped $10m into Ovato, in the form of providing a $5.1m loan, and taking over a $4.8m chattel mortgage. Left Field now owns around 14.7 per cent of Ovato. However, Celarc told Print21, “There is no intention to take over Ovato. Catalogues are not our field.”
The latest $11m raised by Ovato from Opus will be used in general working capital of the company. The deal is subject to the ACCC, which knocked back a similar deal a decade ago, when Opus tried to buy what was then PMP's book business, but Celarc said, “The world has changed, we are all confident it will go through.”
The sale of the book printing business leaves Ovato as a 100 per cent heatset print operation, with the company having divested all its other businesses over the past year, including marketing services and magazine distribution. It has also closed its New Zealand heatset business.
James Hannan, CEO at Ovato said, “This deal provides a refreshed debt profile and a path towards equity and investment from an experienced industry player. Further narrowing of Ovato’s focus will only strengthen our ability to continue to deliver quality and efficiency to our valued clients across our packaging, sheetfed and offset printing businesses.”
What was Griffin Press is a technologically advanced business, with a full, on-demand digital print line with an HP digital web and HP Indigo for printing the covers. It also has an advanced Kolbus case-binding line.
Opus already owns book printers Ligare and McPherson’s, as well as government and commercial printer CanPrint. It became part of Left Field five years ago, when it delisted from the ASX.