R.R. Donnelley's Bid for Quebecor World
By Adam Dewitz
Published: June 9, 2009
R.R. Donnelley reveled in an SEC filling on June 8th that the company had delivered a revised non-binding proposal to Quebecor World regarding R.R. Donnelley's interest in the acquisition of all or substantially all of the assets and properties of Quebecor World. The revised proposal sweetens the deal for Quebecor World and its creditors by increasing its offer to "US$178,000,000 (US$100,000,000 plus an additional US$78,000,000 in cash on the balance sheet)." The letter also includes the handling of pensions, labor and tax issues. [Updated 6/9] Folio just published a story stating, "Quebecor World has effectively rejected R.R. Donnelley’s $1.825 billion offer to acquire the company" based on a document filed yesterday with the U.S. bankruptcy court (you can access the documents here). According to the report Quebecor World feels their successful reorganization provides a better deal for the company and its creditors.
[Updated 6/10] RR Donnelley has sent out a press release stating its proposal has expired:
“We are disappointed by the decision of Quebecor World to reject our June 8 proposal,” said Thomas J. Quinlan III, RR Donnelley’s President and Chief Executive Officer. “We believe that our proposal was undoubtedly in the best interests of creditors based on a comparison of the distributions under our proposal with the distributions under the proposed stand-alone plan of reorganization. We are particularly disappointed because of the efforts and concessions made by us to adapt our proposal in response to concerns that were communicated to us.”
“This would have been an excellent fit for RR Donnelley and the best opportunity for the Quebecor World creditors. However, given our view of the Quebecor World operations, a transaction ascribing a higher value to Quebecor World than we offered in our last proposal is simply not in the interests of RR Donnelley,” said Mr. Quinlan. “We look forward to continuing to pursue other strategic initiatives.”
Proposal to Acquire the Assets of Quebecor World Expires
On Friday Folio ran a story pointing out the problems R.R. Donnelley may face with the acquisition including antitrust and coming to agreement with Quebecor World's creditors. The revised proposal addresses the issues Folio outlined in the article.
Earlier last week Dead Tree Edition (the anonymous blog authored by a magazine manager) ran a Q&A on the Donnelley-Quebecor World Deal that starts out pointing I'm wrong about the antitrust trust issue by overlooking the gravure printing operations. If I remember correctly the Federal Trade Commission stepped in to stop Donnelley's acquisition of Meredith-Burda in 1990 over gravure printing operations.
PrintCAN reported over the weekend that based on Canadian trademark office filings Quebecor World may change its name to Novink. There has been speculation in the past that Quebecor Inc has pressured Quebecor World to change its name.