Agfa buys Gandi

The news that Agfa acquired struggling Gandinnovations (Gandinnovations has been in bankruptcy since May 2009) is interesting because it gives Agfa a wider, more robust portfolio of products with which to go up against the more prominent wide format/commercial printing companies in the global market (HP, EFI, Screen & Fujifilm). In wide format, Agfa has been deeply involved in UV-curable inkjet with its Anapurna line, but not participating in the wide format solvent inkjet (which Gandi has also been getting out of) or wide format dye-sublimation markets. The acquisition of Gandi by Agfa makes sense for Agfa from the portfolio perspective. As details come out about how much Agfa paid for Gandinnovations and how much of Gandi’s obligations Agfa will assume it will become clearer whether or not this was a good deal. Agfa’s Graphics business unit had 2008 sales of almost 41.5 billion, so the acquisition of Gandinnovations is probably not a “major risk” kind of deal from a financial standpoint. However much Agfa paid for Gandinnovations or debt Agfa assumed, real value will only be determined if Agfa uses the Gandinnovations line to compete and grow its wide format business. InfoTrends thinks it is likely Agfa will “kill” Gandi’s solvent line and use their dye-sub and UV-curable inkjet products to complement Agfa’s existing wide format printer lineup. Our initial view is that Agfa’s acquisition of Gandinnovations is a strong, low-risk (depending on what Agfa paid) way to complement a portfolio to be better able to compete against bigger competitors.