Paragon Group’s Patrick Crean has reached – and breached – his €1bn turnover goal with the purchase of RR Donnelley’s European Global Document Solutions business, which includes major operations in Krakow. The deal was announced on 28 October. The sale price was not disclosed. GDS is headquartered in the UK and has operations in France, Spain, Germany, the Netherlands, Poland and Italy and employs around 1,500 people. Net sales were approximately $270m in 2018.
Back in 2005 RR Donnelley paid almost $1 billion to acquire the Astron Group of business process outsourcing companies that were the foundation of the GDS business.
In a statement Crean, Paragon’s chairman and chief executive officer, said: “We are delighted to acquire RRD’s GDS European businesses and are pleased to announce that we have also entered into a strategic alliance with RRD, which will expand the offerings both companies provide to clients.
The business will become part of Paragon’s Customer Communications business unit.
RR Donnelley GDS works with blue-chip clients in financial services, insurance, investment banking, retail, legal and property. RR Donnelley’s entire European business had sales of $485.9 million last year, up from $455 million in 2017.
Last year $6.8bn turnover RR Donnelley reorganised its business into two segments: Business Services (83% of sales) and Marketing Solutions (17%). It also sold its Print Logistics business last year. CEO Dan Knotts described the GDS sale as “another key step” in the group’s strategic transformation and optimisation of its business portfolio. “The strategic alliance we have established with Paragon, the European leader in communications solutions, enables us to offer an enhanced set of capabilities in the region,” Knotts said.
Privately-owned Paragon Group posted record results with sales of €673m in 2018, with pro forma sales reaching €857m on the back of a string of acquisitions, most recently parts of the Howard Hunt group.
Former printing industry giant RR Donnelley split into three separate businesses in October 2016: RR Donnelley, LSC Communications and Donnelley Financial Solutions. Two months ago RR Donnelley instigated a so-called “poison pill” rights plan to thwart any plans by activist investors to wrest control of the company.