A leveraged buyout gone bad in the local printing industry has created a big expansion opportunity for Bolger, the 75-year-old family-owned printing-and-fulfillment company based in southeast Minneapolis.
The company, now known as Bolger Vision Beyond Print, will announce today that it has acquired Diversified Graphics of northeast Minneapolis, a venerable printer based about a mile away from Bolger.
"We know them very well," said Charlie Bolger, 54, who with his brother Dik, 53, runs the company. "I'm not a gambler but we think we're taking a calculated risk. We think we can grow the combined company profitably."
The opportunity grew out of the recent bankruptcy of Diversified Graphics, which was acquired in 2005 by Chicago-based private equity investors from the Gacek family of Minneapolis for an undisclosed price. Key managers left the company, a greeting card subsidiary was sold, and things apparently didn't work out for the new owners.
Bolger was the winning bidder at $10 million for the assets, among 12 who sought Diversified in a deal approved by a judge in U.S. Bankruptcy Court in Minneapolis.
The private equity firms had their interest wiped out. Marquette Capital, owned by the Pohlad family, and Plymouth-based Convergent, two lenders in the 2005 deal, have had their debt converted into a minority equity stake in the expanded Bolger.
"Dik and I retain control of the consolidated company," Charlie Bolger said Monday. "We have excess capacity and very talented people who came with Diversified. Our management appreciates the challenge."
The Bolger organization has laid off about 40 people from the combined Bolger-Diversified workforce of about 300; the company should produce revenues of more than $55 million in 2008.
The merged company plans to close by year-end and eventually sell Diversified's two Minneapolis plants on NE. Broadway Avenue. Some equipment will be transferred to Bolger's more modern facilities and a Diversified warehouse in Roseville will be retained.
Bolger is now one of the 10 largest Minnesota printing firms and among the 100 largest national printers in an industry that's consolidating amid excess capacity, thanks in part to the proliferation of electronic communications.
Consolidating industry
The number of independent printers has shrunk from 55,000 to 35,000 nationally over the last decade, according to industry figures.
Bolger, whose clients include 3M Co., Medica, Ceridian, Cargill and Martin Willliams advertising, has invested heavily in technology and expanded its business from printing jobs in order to grow and retain clients.
Bolger produces catalogs, magazines, brochures and marketing materials for dozens of clients from health care to manufacturing.
In one building, it houses litho printing, a design agency and mailing operations. In another, it hosts print-on-demand work, quick printing and fulfillment operations that distribute marketing and other materials it prints to clients to customers.
Diversified was a high-end specialty printer that lost some key people and failed to reinvest under the absentee owners, said Dik Bolger. The Diversified business will create a new market for the Bolger sales force.
"Their top salesperson is married to our pressroom foreman and we've done backup work from them over the years and vice versa," Dik Bolger said. "Diversified did a great job [for 35 years] as a family-owned business of growing the company. And there still is a Gacek in the business who now works for us in sales, Jonathon Gacek. I believe the Diversified people are pleased to be back in a locally owned and managed business."
The late Genevieve Bolger, who ran the company for 50 years, and her late husband, John, are legends in the national printing industry.
John Bolger focused on engineering and manufacturing innovation. Genevieve Bolger was the marketer and soul of the company who showed up in a wheelchair and on oxygen to present a 45-year service award to an employee, shortly before her 2006 death.
Neal St. Anthony • 612-673-7144 • nstanthony@startribune.com
