Information on the Target

CGS Management is expanding its investment portfolio through the acquisition of majority stakes in Rotodecor GmbH and PadaLuma Ink-Jet Solutions GmbH, thereby establishing a leading global provider of industrial printing machines for the decor and packaging industries. Founded in 2003, Rotodecor has secured its position as a top manufacturer of gravure printing, coating, cutting, and processing machines within its sector. The company operates from its headquarters in Lage, Germany, and maintains a production facility in Taicang, China. With a workforce of over 90 employees, Rotodecor will serve as a foundational investment for the newly formed Hummingbird Converting Solutions.

Thomas Schmid, CEO of Rotodecor, has been appointed Group CEO of Hummingbird Converting Solutions, where he will be pivotal in advancing the group into a globally recognized leader in industrial printing solutions for the decor and packaging markets. In tandem, PadaLuma Ink-Jet Solutions GmbH, a joint venture among PadaLuma GmbH, Schoeller Technocell GmbH & Co. KG, and RMS Holding GmbH, specializes in innovative digital printing machines for the same industries as Rotodecor, further enhancing the product portfolio of Hummingbird Converting Solutions.

Industry Overview in Germany

The decor and packaging industry in Germany is characterized by its emphasis on innovation and technology-driven solutions. Germany is renowned for its leading role in manufacturing and engineering, which significantly contributes to the overall excellence in product design and quality. The demand for sophisticated and high-quality printing solutions is continually rising, driven by consumer preferences for more personalized and unique products. The packaging market alone is expected to witness substantial growth as e-commerce expands, requiring innovative packaging solutions capable of attracting online shoppers.

Furthermore, the increasing focus on sustainability within this industry has prompted businesses to seek environmentally friendly printing technologies and materials. Companies are expected to invest heavily in R&D to develop cutting-edge solutions that align with these trends. The digital transformation in the printing sector opens vast opportunities for innovation and efficiency, particularly in digital printing technologies, thus reinforcing Germany’s competitive edge.

Moreover, the strong presence of established companies and a robust SME ecosystem in the German market provides a solid framework for new entrants and investors alike. This ecosystem fosters collaboration and partnerships, enabling companies to leverage each other's strengths and expertise, driving the industry forward.

As the global demand for sophisticated printing technology continues to grow, German companies are well-positioned to lead the way, making it an attractive destination for investors seeking to tap into the potential of the decor and packaging markets.

The Rationale Behind the Deal

The acquisition of Rotodecor and PadaLuma by CGS Management aligns strategically with the latter's objective to enhance its market presence in the decor and packaging printing industries. By integrating both companies under the Hummingbird Converting Solutions umbrella, CGS is poised to capitalize on the technological advancements and synergies between gravure and digital printing technologies.

This merger aims to create a robust platform offering a comprehensive range of printing solutions tailored to meet the diverse needs of clients, thereby strengthening CGS Management's competitive position in the global market.

Information about the Investor

CGS Management AG is an independent and experienced industrial partner based in Pfäffikon, Switzerland. Since its establishment in 1999, CGS has specialized in transforming medium-sized enterprises into international groups through strategic investments in platform companies in the German-speaking countries of Europe, as well as selective acquisitions worldwide. The firm is recognized for its active management style and its capacity to implement innovative growth strategies within its portfolio companies.

CGS's commitment to fostering long-term growth and profitability has resulted in the successful development of numerous companies in various sectors. Its extensive expertise and strategic vision position CGS to effectively support the advancement of Rotodecor and PadaLuma, ensuring they remain competitive in the rapidly evolving printing landscape.

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This deal presents a significant opportunity for CGS Management to establish a dominant position in the decor and packaging industries by leveraging the strengths of both Rotodecor and PadaLuma. The combination of established gravure printing technology with innovative digital solutions positions Hummingbird Converting Solutions as a formidable player in the market. The increasing demand for high-quality and customized printing solutions complements the strategic goals of the newly formed group.

Investing in the Hummingbird Converting Solutions aligns well with current industry trends, particularly the shift toward digital innovation and sustainable printing practices. Given the growing market for packaging and décor solutions, the investment seems promising, as it caters to an expanding customer base that values quality and personalization.

Furthermore, the collaborative synergy between the existing operations and technologies of Rotodecor and PadaLuma could yield enhanced product offerings and improved efficiencies, ultimately driving revenue growth for the group. As such, CGS Management's bet on these companies reflects a well-thought-out strategy to maximize the potential of the decor and packaging markets.

Overall, this investment is likely to yield significant returns, driven by strong market demand and the strategic combination of digital and gravure printing capabilities, making it a sound addition to CGS Management's investment portfolio.

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