Print franchise group Alphagraphics has been acquired from its private equity owners by MBE Worldwide, owner of Mail Boxes Etc, a business that has offered printing and communications services across its 39 country international network for $61.5 million.
Alphagraphics has 265 locations, the majority in the US and was acquired by Blackstreet Capital, the majority shareholder of Western Capital Resources in January 2012. It bought the business from the administrator of the Pindar Group. Under private equity ownership, Alphagraphics has managed to increase earnings substantially.
"We have enjoyed our relationship with Alphagraphics and its franchisees over the years," says Murry Gunty, Blackstreet founder and CEO. "We believe they are in very capable hands with MBE, which is positioned to do great things with the business going forward.”
The Italian owned MBE has already acquired PostNet, a franchise operation in the US this year and with Alphagraphics now claims 2,600 locations generating revenues of $940 million a year. Alphagraphics will continue to operate under its current identity and management from head quarters in Salt Lake City.
In the longer term, ownership through a company that is steeped in franchising will be a benefit over private equity ownership. This will lead to faster expansion in terms of sites and investment, even without the potential to cross fertilise business between MBE and Alphagraphics, “MBE is a strategic and sophisticated buyer whose management has significant experience in franchising operations and is dedicated to strengthening Alphagraphics' offerings and competitiveness in the domestic and international market,” says WCE president and CEO John Quandahl.
“Alphagraphics is an excellent strategic fit for MBE because of its entrepreneur driven, people centric, customer first business model, which complements our MBE business and culture. Also, Alphagraphics has earned a reputation for technological and service excellence in the highly competitive print, marketing and communications industry in the US,” says Paolo Fiorelli, chairman and CEO of MBE
The deal endorses the importance of a physical presence for print and design services offered to small businesses at a time that online print businesses have been targeting a similar range of work, either directly or through resellers.
Alphagraphics has a new owner five years after the company was acquired from administrators for Pindar Group. The new owner has greater synergy with the franchise group and has plans to invest and expand the business.