Private equity firm wraps up Presstek acquisition
The private equity firm American Industrial Partners on Wednesday completed its $26 million acquisition of the Presstek Inc., the printing equipment firm based in Connecticut with a major production facility in Hudson. The sale price amounted to 50 cents a share, Presstek announced Thursday morning.
But it's still not clear what AIP plans to do with the company, which has suffered millions of dollars in losses through an economic slowdown that has been particularly hard on the printing industry. AIP already owns Mark Andy Inc., a Missouri firm that manufactures presses to make labels and packaging.
Presstek presses are used more for mailings and small publications, but there will be some overlap. AIP has said there would be some synergies between the two companies, but would not go into details over what that would mean to Presstek as a whole or for its Hudson facility.
"Whatever is going to happen, we don't know," said spokesperson Brian Wolfenden. "But the employees think this is a good thing. They are optimistic. It puts Presstek in a much better spot. We are a good company with good products, and we are excited about it.
"The deal closed two days before the company's stock would have been delisted from the Nasdaq exchange for not keeping its share price above a dollar and about a week after tentatively settling shareholder class action suits against the merger.AIP is currently managing more than $1.1 billion in capital. According to its website, the company specializes in industrial companies and "supports talented management teams in building their business. We do not play a role in the daily operations of portfolio companies, but rather form a true partnership with management to drive growth."
AIP is acquiring Presstek for $18.7 million, but with assumed debt, the cost of the deal is estimated at $26.1 million. Presstek, which lost a total of $73 million from 2009 to 2011, had shopped itself around for more than a year, but the offers continued to get lower as the company's losses continued, revenue declined, former top executives quit, and its the stock price fell.
On Oct. 23, Presstek said it entered a memorandum of understanding to settle a shareholder lawsuit filed federal court in Connecticut. The terms say the suit would be dismissed, for an undisclosed sum, following the merger. In the settlement, Presstek did not admit to any wrongdoing. Such a settlement would have to be approved by the court, and as of Nov. 1, no such settlement or motion to dismiss the suit, had been filed in court.