MSI Boosts Printing Services With Waldon Acquisition
"MSI really was once a traditional letter shop," Riback said, "and we have evolved from a traditional letter shop where we were basically doing mailing to where we work on the customer's entire document process and we do the mailing. That's really where we're going."
The purchase of Waldon, which has an annual revenue of about $10 million, effectively doubles the size of MSI, a unit of Paris-based media group Havas Advertising. The conglomerate controls advertising agencies, direct mail firms and publishing concerns. Riback declined to disclose further details of the Waldon deal.
MSI supplies mailing services and fulfillment, database management and personalization, sheetfed printing and digital on-demand printing. About 20 percent of its print work is direct mail related, and the company has done mailings for Bell Atlantic, MetLife and Canon USA, among others. MSI does only limited design work, though Riback said another acquisition is being worked on that will add design capability to its arsenal.
In buying Waldon, MSI tacks on horsepower to its output engines, gaining long-run printing from roll-fed presses and additional sheeted printing ability, which is designed for shorter runs. MSI picks up about 40 employees to add to its staff of 140. The company plans to keep the Waldon staff intact, as well as add some workers.
MSI's business model, which he calls a "three-legged stool," starts with acquiring customer's document data, often electronically, and then formatting the data. The second leg is the printing itself, a portion of the model that Waldon will round out for MSI by bringing more web- and sheetfed-printing capacity. The third component is mailing and distribution services, which MSI already had.
"It really gives us more flexibility because we're able to provide our total client base with services we never were able to do before. We had to farm it out. Now we can do it all. More and more, clients want to talk to one company," said Richard Skolnik, executive vice president of sales at MSI, adding that MSI will start meeting with Waldon's current clients to offer them services for which they now most likely must go to separate vendors.
About 85 to 90 percent of MSI's business is in the New York metropolitan area, where several smaller players perform portions of the document process, along with a few large players that provide a full gamut of services. The direct mail business has undergone recent consolidation as smaller firms beef themselves up, but Riback said the Waldon buy is different because the purchase is meant to broaden MSI's services rather than boost its size.
"My thought for us is that you don't want to just be doing one vertical function for a customer because I think the customers are looking more and more for partners that do more than one thing so they can reduce their administrative burden, and that's the kind of need that we're fulfilling," he said.
MSI is building a new 60,000-square-foot headquarters in Carlstadt, NJ, near the New Jersey Meadowlands. It expects to move this fall, but the company will maintain a Manhattan office for customers who need rush services. Waldon will continue to operate from its Manhattan location as MSI management determines the best manufacturing operations for the entire production process, Riback said.
MSI's target markets include the financial services, pharmaceuticals and publishing areas. Other MSI customers include Citicorp, Price Waterhouse LLP, Bankers Trust, Bantam Doubleday Dell, Sony and Swissair.