Sunday, June 28, 2009

Quebecor World: Has the Stalked Become the Stalker?

Even his initials are M&A.

Fresh from rejecting several acquisition attempts by rival R.R. Donnelley, Quebecor World stunned the Donnelley folks this week by announcing a new chairman who knows a thing or two about mergers and acquisitions in the printing industry. And about Donnelley.

Mark A. Angelson, who retired from RRD two years ago after leading a massive acquisition drive that turned it into the world's largest printer, is to become the new Quebecor World chairman when the company emerges from bankruptcy protection and changes it name, reportedly to Novink. That is supposed to occur next month, though the U.S. government threw a fly into the ointment this week by objecting to QW's reorganization plan in bankruptcy court.

A lawyer by training, Angelson seems to live for the deal.

After bringing about the merger that created the Moore Wallace printing company, Angelson engineered the combination of Moore Wallace and Donnelley. Then in just four years as CEO at Donnelley, he led its acquisitions of Banta, Perry Judd's, and Von Hoffman, among others. His protege, Thomas Quinlan III, now heads Donnelley.

All of this leads to the obvious question: What is Quebecor World up to?

A hint came in this statement by a spokesman for Angelson and the other new QW directors: "The highly fragmented printing industry must undergo further consolidation, and this company will be an important part of that process. We look forward to providing overall strategic guidance, best governance practices and oversight."

That Donnelley-esque statement is a wake-up call for the Donnelley folks, who thought they were the ones to pursue the "strategic initiatives" to consolidate the North American printing industry. Those who crafted the proposal that Donnelley become QW's stalking-horse bidder were reportedly caught off guard by QW's responses, which amounted to "No," "No," and "Hell, no!"

Is Quebecor World audacious enough to think it can raise the capital to make a run at buying competitors? Or do the banks and other creditors who essentially own QW want an M&A guy who can get the maximum value from selling off or breaking up the company? Will Angelson remain a non-executive chairman, or will he end up running the company?

Let the games begin!

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