Tom Vacchiano, President & CEO of X-Rite Pantone, talks to Cary Sherburne about about the two companies coming together and the synergies born from that combination as well as the potential for the future. They also discuss the possibility of a Danaher acquisition of the company.
Cary Sherburne: Hi, I’m Cary Sherburne, Senior Editor at WhatTheyThink. And I'm here with Tom Vacchiano who is President & CEO of X-Rite Pantone. Welcome.
Tom Vacchiano: Hi, thanks to be here.
Cary Sherburne: And X-Rite Pantone. So combined entity now. I guess it’s about four years ago that you acquired them.
Tom Vacchiano: That’s right. October of 2007.
Cary Sherburne: 7, long time ago. And maybe you could just talk a little bit about what you’re seeing as now, in reality, as the synergies between the companies, and what are some of the things that you expect to develop jointly going forward?
Tom Vacchiano: That’s a great question, Cary. I will tell you, it is, right now, that we’re really seeing kind of the fruits of that investment. And what I mean by that is that just this year, in fact March 1st in London, we announced, X-Rite Pantone announced Pantone Live. And Pantone Live is really one of the major outputs from the partnership and from the acquisition. Pantone Live is a cloud-based technology solution for the graphic arts industry from designer, brand manager, through converter or product realization, a node in the workflow. And it’s only because of the combination of X-Rite’s technology and know-how, and Pantone’s methodology for color communication taking kind of the physical metaphor into a digital metaphor. We’re really excited about it. Getting great buzz in the market.
Cary Sherburne: Well, and you know we had an opportunity to talk a couple of times to John Drennan from Chesapeake, and he told me that about 50% of their volume now in the packaging market is running through Pantone Live and as an actual user. It’s fine for you to say it, but as an actual user to say, “This has revolutionized our business,” that’s, congratulations. That’s really great.
Tom Vacchiano: Thank you. And of course, he’s a great advocate for us. And hopefully his message, and the message of a few other great customer advocates is getting around. I think it is. The buzz for Pantone Live has been terrific.
Cary Sherburne: That’s good.
Tom Vacchiano: The other thing I would say about the acquisition with Pantone that’s sort of, in terms of value creation is X-Rite’s history has been sort of in the laps and in the production floor. Pantone, of course, has been very present with brand owners and designers, and creators. The ability for the Pantone customer set and the X-Rite customer set to come together in these integrated digital workflows has really improved our opportunity to create end-to-end solutions.
Cary Sherburne: Sort of blending the science, yeah.
Tom Vacchiano: Absolutely. Not only the art and the science, but also touching all the actors in the workflow. So if you’re a production quality-control manager, and you’re trying to meet the needs of a brand owner or a product manager up the value chain, our understanding of the entire supply chain or value chain from designer, product manager, to pre-press, and converter, with Pantone’s participation, we’ve really done, I think, a much better job in meeting everyone’s sort of needs, by understanding each actor in the value chain.
Cary Sherburne: That’s great. And just quickly, because I know you can’t really say a lot at this point as we record this, but obviously Danaher the parent company of Esko has an offer out for X-Rite Pantone. And maybe you could just comment a little bit about that.
Tom Vacchiano: I can. And we’re really excited about it. Danaher, of course is a terrific company. It’s an 18 billion fortune 200 company, so it has a great size and scale. They also have a great reputation. They’re a leader in the engineering and sciences areas. And of course they value innovation in that space. And of course, X-Rite Pantone has a history of valuing innovation. So there’s quite a nice connection around innovating for creating new value for our customers. Also, I would tell you that Danaher really appreciates and respects X-Rite and Pantone’s brands, our product, our market position. They really like our strategic growth strategy going forward. And they’re big advocates in helping us move forward. And also some of the things we’re doing beyond color, moving into appearance capture, appearance communication, and appearance rendering. So I think they’re going to be a really great ally for us, and hopefully they’ll allow us to create more value for our customers going forward.
Cary Sherburne: Well that’ll be great, and a little later in the summer of 2012, hopefully, the expectation is that, of course, that will close. And we’ll get back with you and see what’s going on there, and how you might have interacted with your brethren at Esko by then.
Tom Vacchiano: That’ll be great. Thank you so much, enjoy doing it. Thank you.
Cary Sherburne: Same here.