Blue Star’s plan to merge with IPMG may have fallen through but it has picked up its second company in a week, closing the deal to buy STI Group’s Australian business last night.
Adding the $20m-a-year point-of-sale business will significantly bolster Blue Star’s recent foray into wide format as it seeks to expand its customer base and printing offerings beyond its predominantly sheetfed and webpress enterprise.
Along with acquiring rival mailhouse iGroup Australia last week, Blue Star has added $60m-70m a year worth of turnover, pushing it close to $400m in total.
The STI facility and point-of-sale production in Padstow will remain intact along with all staff working in that area of the business under the continued leadership of managing director Stephen De Lorenzo, and be enhanced in coming months with the addition of new equipment and further investment.
However, its commercial print operation will be absorbed into Blue Star’s Silverwater site, with the fate of those staff unclear.
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Like the ill-fated IPMG merger, the deal has taken longer to complete than anticipated with the May 30 expected date passing almost two weeks ago. The business handover is slated for June 30.
Blue Star print group general manager Matt Aitken says the acquisition will allow Blue Star to bring its point-of-sale offering in-house.
“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.”
He says the reaction from both customer groups since the heads agreement was signed in April has been very positive and shows how highly regarded the STI business is in Australia.
Following the agreement, De Lorenzo said 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.
“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 said.
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 said.
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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.
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.
STI Group managing director Tom Giessler says: “We specialise in driving our customers’ success by developing highly creative POP and competitive supply chain solutions.”
“This partnership helps to further our aim of delivering a truly seamless service, no matter where in the world our customers and their needs are based.”
While details for the partnership are not yet public, De Lorenzo said in April that 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.
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