Paragon Group has acquired the UK business of DG3, its first acquisition for more than a year and one that has been under negotiation for several months.
It adds a £25 million business that operates from sites in Dagenham, close to Paragon Customer Communications’ flagship site in the same part of Essex, and in Gillingham, Kent. The acquisition adds further transactional and commercial print capabilities to Paragon Customer Communications (PCC), particularly with project style print, including high value books and report and accounts work.
DG3 managing director Gary Wilson remains in this position and the business will retain its identity as DG3 Leycol. It will also continue to work for DG3 clients on behalf of the US group.
DG3 was acquired by Resilience Capital Partners in 2016 and has since been developing a strategy that focuses on growth beyond the core print business, but centred on US activities. The effects of the pandemic have accelerated these plans. “We look forward to continue servicing our global customers in Europe,” says DG3 president and CEO Steve Babat.
Jeremy Walters, CEO of PCC UK, Ireland and Luxembourg, agrees, saying: “This is an exciting time for our business and I am delighted to have completed this acquisition, which will enable us to strengthen our relationship with our core transactional customers and further expand our operations into key markets.”
There are unlikely to be any changes for the acquired business. DG3 Europe reported a profit for 2019, though subsequently business has been knocked by the effects of pandemic. It has a reputation for high quality, award winning work, with a growing volume of book projects handled for corporate clients in particular. It operates a fleet of HP Indigo presses under a highly automated workflow in Dagenham and a sophisticated litho operation in Kent, which installed a five-colour KBA Rapida 106 in 2019, earning KBA UK’s Production Excellence Award later that year.
It is positioned to pick up work that has not been a comfortable fit in Paragon’s high efficiency production set up.
The roots of DG3 go back to Roda Print in London, Cunningham Graphics International in the US and Workable in Hong Kong. The three entered a strategic alliance during the 1990s at a time when there was a need for simultaneous publication of printed financial documentation. CGI then acquired Apollo UK and Goldhawk Print Services, followed by 3D Digital, becoming DG3 in 2007. Acquisition led growth continued in the UK with the purchase of FS Moore and latterly the assets of Sterling Financial Print, Leycol and the assets of Newnorth Print.
Paragon CEO Sean Shine says: “We are pleased to welcome DG3 to the Paragon Group. DG3’s knowledge and expertise in business communication and marketing solutions will add significant value to our growing Paragon Customer Communications business.
“Paragon continues to assess markets to ensure we align our service offering with our customer demands and this acquisition addresses existing customer requirements. The acquisition underlines Paragon Group’s ongoing commitment to being the market leading service provider for businesses across Europe.”
The change in approach had put DG3 Europe in a difficult position, says Wilson, setting off a chain of events that led to conversations with other VC companies as well as Paragon, prompting extensive due diligence. The sale to the trade buyer was Wilson’s preferred option.
“We are very, very pleased with this outcome,” he says. “Paragon is a huge company and there will be lots of benefits across the group for everybody. It’s an exciting move.”
