X-RITE TO BUY PANTONE FOR $180M.

[Anonymous]

X-Rite to Buy Pantone for $180M
August 
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
solutions
    * 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

The
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.”

[Author]

August 30, 2007 at 12:01 PM