German Post Buying Spree Nabs YellowStone
This is the second US company the Germans have bought in the last six months as part of a global buying spree that has cost the German Post Office more than $5 billion.
Neither the Germans nor YellowStone would reveal the purchase price. The silence is unusual since Deutsche Post has published the price it paid for all recent acquisitions, including $400 million for Global Mail, the VA-based US mailing company.
German Post Office profits last year totaled 1.3 billion Deutschmarks ($722.2 million) and it realized several hundred million more through real estate sales. The semi-privatized company plans to go public next year.
"We hope to be able to offer YellowStone's services to European mailers interested in entering the US market through delivery of publications," said Hans-Juergen Gaertner, the press spokesman for German Post here.
YellowStone handles international distribution for several large publishing companies, including Cahners Publishing, Crain Communications, Penton Media, Miller Freeman and Intertec Publishing.
The acquisition will allow the Germans not only to enter a new market in the US and to bring Americans to Europe, but will also give them access to YellowStone's address hygiene services and its direct injection capability in 35 nations.
Deutsche Post plans to keep YellowStone's management team in place and to operate the company as an independent business unit with its own brand and marketing focus. YellowStone's 1998 sales totaled $21 million.
But the new owners will put senior managers with global expertise on YellowStone's board to help the company's "future development" and to explore available synergies.
A German engineering team will come to YellowStone in the near future while a team from the US company will study methods and procedures of the new owners in Bonn.
YellowStone expects to expand into other regions of the world with Deutsche Post. "We now have the tentacles of a global player," said Yellowstone CEO Victor Schiegg.
Schiegg added that when "[Deutsche Post] elects to move, they do it very aggressively, which is apparent by the acquisitions they have completed over the last six months.
"Deutsche Post is really becoming a global logistics player in everything that is associated with mail. They are into the parcel business, the shipping business, the logistics business, the direct mail business and now the publications business."
Further US acquisitions "are not planned at this time," spokesman Gaertner said. But he noted that Deutsche Post's European network has not been fully completed.
Deutsche Post owns or has major stakes in postal companies in France, Benelux, the UK, Italy, Poland, Switzerland, Scandinavia, Austria and the Czech Republic.
"We think we are 75 percent there," Gaertner said, "and it could be that we will announce other purchases this year in southern Europe."