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August 2, 2018
martinwolf  Transaction Analysis
HP To Acquire Apogee for $500M

Financial Information*
  • Enterprise Value                                        ~$500M
  • EV/LTM Revenue                                        N/A
  • EV/LTM EBITDA                                          N/A
Transaction Facts
  • HP (NYSE: HPQ) announced yesterday its definitive agreement to acquire UK-based managed print services provider Apogee Corporation for  £380M, or ~$500M. 
  • As part of the agreement, Apogee will operate as an independent subsidiary of HP.
  • The deal is expected to close by the end of this calendar year.
Advancing Its Managed Print Services Operations
  • Strong Relationships: Apogee not only has relationships with HP but also with major print vendors like Xerox, Konica Minolta, Kyocera and Canon. With 1,000 employees and $300M in annual revenue, Apogee is the largest independent print provider in Europe. Since Apogee has a strong portfolio of high-margin contractual printing services, many of which are long-term contracts for the delivery and sale of hardware and services, HP can be optimistic about revenue gains down the line; the giant can tap into Apogee's current access to SMB and mid-market customers through forthcoming contract renewals.
  • Rich Acquisition History: In 2016, private equity firm Equistone Partners invested in Apogee in a transaction valuing the company at ~$230M. Under its PE parent, the company was able to make several acquisitions, including CityDocs, Danwood and EFCO Corporation.
  • Market Share Growth: Through this acquisition, HP is expecting to gain more market share in the A3 copier space, currently valued at $55B. The giant also is looking to expand its MPS business to new channels.
  • Successful Past: This deal is the next biggest after HP's first major acquisition in the A3 market with its purchase of Samsung's printer business for $1.05B back in 2016. The Samsung acquisition gave its printing unit a strong boost, as HP reported its printing revenue has been steadily growing at 11 percent year-over-year in May.
For more information about this transaction,  click here to read the press release.

*Financial information from the press release and FactSet.

martinwolf was not the advisor in this transaction.

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Headquartered in Scottsdale, Arizona with offices in the San Francisco Bay Area and New York, martinwolf is a leading M&A Advisory focused on middle market companies in the IT Services, IT Supply Chain, IT-Enabled Business Process Outsourcing and Software as a Service (SaaS) space. Since 1997, our team has completed more than 155 transactions in over 20 countries and sold seven divisions of Fortune 500 companies. 

 

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