Blue Star buys STI Lilyfield

The upcoming Blue Star-IPMG print titan just got a little bigger with Blue Star preparing to buy the Australian operations of international packaging and point-of-sale printer STI Group, which has a turnover of about $20m.

The two companies entered a heads of agreement yesterday for Selig’s company to acquire STI Lilyfield after about four weeks of talks, with the deal to be finalised by May 30 – the same day Blue Star and IPMG are to complete their merger.

Blue Star print group general manager Matt Aitken says the addition of STI’s point-of-sale business will allow Blue Star to bring its offering for that market in-house and complement its recent foray into wide format.

“We previously outsourced millions of dollars in point-of-sale print jobs every year that we will now be able to do ourselves, so it’s a good fit that will bring further value to our customers,” he says.

“It’s an extension of the strategy we started when we began large format last year and we want to become stronger in that area. This will allow both Blue Star and STI Lilyfield to offer a wider range of services to their clients.”

[Related: More merger and acquisition news]

Aitken says details are still being worked out and it is unclear if STI Lilyfield will retain its brand identity, but that Blue Star is committed to retaining its Padstow facility and all staff under the continued leadership of managing director Stephen De Lorenzo.

De Lorenzo says the deal stemmed from STI approaching Blue Star about becoming its point-of-sale outsource partner and as talks developed, Blue Star made a compelling offer to buy the Australian business.

He says STI Lilyfield will be a separately branded entity, unlike other divisions in Blue Star’s structure, but he is not sure if it will be called STI, Lilyfield or a completely different name.

“The deal is good for STI because it no longer has the expense of running a production company in Australia but can still give its global clients access to the Australian market,” he says.

De Lorenzo is a 25-year point-of-sale veteran who has run STI Lilyfield since last June when he replaced former managing director Graham Trickey. He says he has grown the point-of-sale side of the business significantly in the past six months and it now has full in-house design capabilities.

“We have an aggressive growth plan and having Blue Star’s resources and clients available to us will make that much easier,” he says.

Aitken says: “We are very impressed with Stephen and are confident he will continue to run the business well.”

Aitken says there are currently no plans to shift staff or equipment from elsewhere in Blue Star to the Padstow site, but he wouldn’t rule out complementary services like wide format moving in later on. He says there could also be redundant equipment that might not be retained.

[Related: More Blue Star news]

Blue Star and STI Group are also planning a global partnership that would involve ideas and technology sharing resulting in a leading point-of-sale solutions offering based on the international expertise and sourcing capability of STI Group.

“This will provide access to both global and local solutions being delivered by a long standing and financially strong Australian business,” the companies said yesterday.

While details for the partnership are also still being discussed, De Lorenzo says Blue Star will get Australian work for STI Group’s global clients and access to global retail intelligence and research, staff exchange programs, and a library of successful previous work overseas that could be adapted for the Australian market.

STI Lilyfield was founded in 1979 by Reg Hammond and was bought in August 2009 by Germany’s STI Group, which operates nine manufacturing sites worldwide and reported $450m group turnover in 2013. It provides end-to-end commercial printing services and point-of-sale solutions.

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