01732 759725
12
ACQUISITIONS
Michael Burke,
Managing Director,
Burke Systems and
Soltuions
Louella Fernandes,
Associate Director,
Quocirca
In a meeting held in Seoul on
September 12, Samsung’s board of
directors approved the sale of its
printing business unit to HP Inc., a
deal valued at $1.05 billion.
In a statement the company said that
upon the approval of shareholders it would
spin off the printing business unit into a
separate company as of November 1 and
sell a 100 per cent stake of the newly
created company and overseas assets
related to the business, to HP.
This is the largest print acquisition in
HP’s history and one which according to
HP, accelerates its growth opportunities in
the copier segment, strengthens its leading
laser printing portfolio that has been
established with Canon and paves the way
for future printing innovation.
An announcement released by HP stated
that it aims to reinvent and replace service-
intensive copiers with superior multifunction
printing. The company said that the
acquisition positions it to ‘disrupt and
reinvent the $55 billion copier industry, a
segment that hasn’t innovated in decades’
and that it is investing to ‘disrupt this
category by replacing copiers with superior
multifunction printer (MFP) technology’.
Accelerating growth
“When we became a separate company
just 10 months ago, it enabled us to
become nimble and focus on accelerating
growth and reinventing industries,” Dion
Weisler, President and CEO of HP said.
HP also says that the deal also creates
new avenues for growth and greater
profitability for partners as they expand
managed print services as sales models
shift from transactional to contractual.
“We are doing this [accelerating
growth and reinventing industries] with
3D printing and the disruption of the $12
trillion traditional manufacturing industry
and now we are going after the $55
billion copier space. The acquisition of
Samsung’s printer business allows us to
deliver print innovation and create entirely
new business opportunities with far better
efficiency, security, and economics for
customers,”Weisler added.
HP argues that copiers are outdated,
complicated machines with dozens of
replaceable parts requiring inefficient
service and maintenance agreements,
claiming that customers are frequently
frustrated with the number of visits needed
to keep copier machines functioning.
Under the agreement, Samsung will
source printers from HP and continue to
market in Korea under the Samsung brand.
Samsung’s printing business which
has 6,000 employees, a production base
in China as well as more than 50 sales
offices globally, posted 2 trillion Korean
won in revenue in 2015. The acquisition
brings a compelling intellectual property
portfolio of more than 6,500 printing
patents and a world-class workforce that
includes nearly 1,300 researchers and
engineers with advanced expertise in laser
printer technology, imaging electronics and
printer supplies and accessories, to support
continued innovation in print market
solutions.
Formidable A3 portfolio
Samsung has built a formidable portfolio
of A3 MFPs that deliver the performance of
copiers with the power, simplicity, reliability
and ease-of-use of printers and with as
few as seven replaceable parts. Integrating
the Samsung printer business’ products,
including their mobile-first and cloud-first
Samsung to sell
printing business to HP
Samsung is to sell the entire global operations and assets of its printing
business to HP. The move, part of Samsung’s efforts to concentrate on its core
business areas, represents a major shake-up in the print industry
user experience, with HP’s next-generation
PageWide technologies will, according
to HP, create a breakthrough portfolio of
printing solutions with the industry’s best
device, document and data security.
“HP Inc. has been a valued partner and
customer of Samsung,” said Dr. Oh-Hyun
Kwon, Vice Chairman and CEO of Samsung
Electronics. “We can now leverage our
combined capacity for innovation to further
enhance the value of our relationship."
Acquiring Samsung’s printer business
will also strengthen HP’s ability to service
customers in global laser printing, a
category where it has enjoyed a strong,
mutually beneficial partnership with
Canon for more than three decades. HP is
confident this transaction will provide new
opportunities to further strengthen and
accelerate this highly valued relationship.
Fujio Mitarai, Chairman and CEO of
Canon Inc.said: “HP and Canon have long
discussed print innovation to create customer
value in business printing and in the growing
MPS market. This transaction will further
evolve our collaboration and bring about
growth for both of our companies.”
The acquisition is expected to be
accretive in the first full year following
closing, with cost synergies and a strong
financial model. The transaction is expected
to close within 12 months pending
regulatory review and other customary
closing conditions. After closing, Samsung
has agreed to make a $100 million to
$300 million equity investment in HP
through open market purchases.
