Paragon snaps up DG3's Europe business in latest buy
Paragon has acquired the DG3 Europe business from its US parent, adding a range of omni-channel marketing and high-end sheetfed litho and digital printing kit to its roster as a result.
DG3 produces work for a raft of high-end clients
The deal completed on 1 December, and the business will become part of Paragon’s £396m turnover Paragon Customer Communications division.
Paragon Group CEO Sean Shine said DG3's knowledge and expertise in business communication and marketing solutions would add “significant value” to the growing Paragon CC business.
“Paragon continues to assess markets to ensure we align our service offering with our customer demands and this acquisition addresses existing customer requirements,” he said.
“Operationally and financially, Paragon is a strong, disciplined, and ambitious company and prides itself on being customer focused. Together, we deliver the future of Customer Communications.”
Paragon had sales of €1.081bn (£918m) in the year to 30 June 2020, and pro forma sales are now around €1.338bn.
Paragon CC chief executive Jeremy Walters said that retaining the DG3 brand and people were key to the transaction.
The acquired DG3 business has two sites in the UK, at Dagenham Docks in London and at Gillingham in Kent.
The Dagenham facility is just around the corner from Paragon CC’s Dagenham supersite.
The firm works for a raft of high-end brands and has a highly skilled and specialised workforce and prides itself on the way it combines people and technology, taking “an advisory approach to every project, each step of the way”.
In its pandemic-impacted results for calendar year 2020 – which at one point involved 60% of employees being put on furlough – DG3 had sales of £18.45m and made an operating loss of just over £1m. In the prior year it had sales of £22.9m, although this was restated as £27.3m in the latest filing after £4.4m of freight services was reclassified as turnover rather than cost of sales.
The business employed 123 staff at the year-end.
The firm’s kit includes a Xerox Trivor 2400 HF continuous feed inkjet, HP Indigo 12000 and 7900 digital presses, and a five-colour high-spec Koenig & Bauer Rapida 106.
DG3 acquired Leycol in 2017 and the Newnorth business in the summer of 2019.
The overall DG3 business was formed in the mid-2000s when the former Cunningham Graphics International (CGI) changed its name to Diversified Global Graphics.
Resilience Capital Partners acquired DG3 in 2016, and subsequently brought in new leadership.
Steve Babat, President and CEO of DG3 said, "We are excited to complete this transaction and look forward to working with Paragon to continue servicing our global customers in Europe. Gary Wilson, managing director and the DG3 UK management team will remain with Paragon to ensure a seamless transition of the business. We will now intensify our efforts on executing our growth strategy for the US business."
Bassem Mansour, co-CEO of Resilience Capital Partners said the disposal meant the DG3 US operation was now “successfully positioned for growth”.
“This transaction will enable DG3 to focus on initiatives to drive the continued growth and transformation of its US business,” he stated.