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 user 2007-08-30 at 12:01:00 pm Views: 49
  • #18675

    X-Rite to Buy Pantone for $180M
    2007 X-Rite, Inc., a leading provider of color solutions for measuring,
    formulating, matching, and simulating color, has entered into a
    definitive agreement to purchase Pantone, Inc. for $180 million. The
    deal is expected to close in the fall of 2007.

    Pantone, Inc.,
    headquartered in Carlstadt, New Jersey, is an authority on color
    inspiration for the design world with the PANTONE MATCHING SYSTEM, an
    innovative system for identifying, matching and communicating colors to
    solve color reproduction problems in the graphic arts market. Pantone
    has expanded its color matching system to other industries where
    accurate color reproductions are critical, including digital
    technology, fashion, home, plastics, architecture and contract
    interiors, and paint.

    Pantone generated revenue of approximately
    $42 million in 2006 with adjusted EBITDA (earnings before interest,
    taxes, depreciation and amortization) of approximately 27 percent of
    revenue. Pantone sells its products, services and technology directly,
    and through hundreds of licensees in over 100 countries in the graphic
    arts, fashion, home, interior, plastics, architectural, paint,
    industrial design and consumer markets.

    Anticipated strategic, operational and financial benefits of the acquisition include:
    * Deepening X-Rite’s range of offerings by adding Pantone’s color
    standards to its leadership position in hardware, software and services
        * Leveraging X-Rite’s global presence and distribution capabilities to expand the reach of Pantone’s color solutions
        * Enhancing X-Rite’s revenue-generating opportunities and further diversifying its revenue base
        * Accelerating technology and business model innovation
        * Achieving significant synergies in marketing, operations and administration

    transaction is expected to be accretive to X-Rite’s cash earnings per
    share during year two of the combined operations. X-Rite expects to
    achieve approximately $6.5 million of annual operating expense cost
    savings associated with the transaction in year two. During the first
    year, the company expects to incur cash restructuring costs of
    approximately $5.5 million.“Larry Herbert and his team have built
    Pantone into a very successful business and we are delighted that it
    will now be part of the X-Rite family,” said Tom Vacchiano, chief
    executive officer of X-Rite. “This iconic brand is the perfect
    complement to X-Rite’s business bringing Pantone’s expertise and market
    position in color communication and standards to our color solutions
    product offerings. We believe that this strategic acquisition will
    provide value for our shareholders, customers, employees and
    partners.”“We have proven expertise in integrating sizable, strategic
    acquisitions into our business,” Vacchiano continued. “We are confident
    that we can successfully blend the Pantone integration with our
    existing responsibilities as we evolve into a faster growing, more
    diverse business.”“Pantone and X-Rite have enjoyed a strategic
    partnership in providing color management solutions for the digital
    imaging market for the last two years,” stated Larry Herbert, chief
    executive officer of Pantone. “Our company is wholly committed to color
    communication and inspiration and we are enthusiastic about combining
    our growing business with X-Rite to apply even greater resources to
    this work.”