EFI's Buying Spree
Does battle for Printcafe signal a dot-com comeback?
Electronics for Imaging (EFI) seems to have decided that this is a good year to spend some money. Earlier in 2003, the company--probably best known for its Fiery line of print servers--completed its acquisition of Best, the German developer of inkjet-proofing software. And just last week EFI became the apparent winner in a struggle for control of Printcafe, the so-called "operating system for print."
Printcafe was launched during the dot-com boom years and was one of a handful of sites aimed at bringing e-commerce to the graphic arts by enabling printers and print buyers to negotiate contracts and manage jobs over the Web. Unlike most of the other dot-coms, Printcafe also offered tools for managing an in-house printing workflow.
While Printcafe still loses money, as any good dot-com should, it's losing less than it used to. Creo, the Vancouver-based imaging and workflow company, has long been a major shareholder in Printcafe, and last January they increased their portion of Printcafe stock to 55%. They also submitted a proposal to acquire all remaining shares at an 11% premium over the listed price.
The very next day, EFI made an offer for the outstanding shares, offering twice as much per share as Creo. Two weeks later, Printcafe adopted a "poison pill" or "shark repellent" plan that restricted the company's ability to deal with a third party other than EFI--in other words, Creo. In response, Creo announced on February 19 that it was filing suit to prevent Printcafe's actions, alleging that they would cause harm to Creo both as a business partner and as a stockholder. On February 24, Creo upped their offer to acquire all remaining shares at a 15% premium over EFI's offer. The very next day came word that Creo had withdrawn from the bidding, saying more or less that they'd decided Printcafe wasn't worth the money after all. And the day after that came word that EFI would acquire Printcafe outright.
Well. We haven't seen this much excitement about a dot-com in a couple of years now. For its part, Creo still holds its shares of Printcafe, though perhaps not for long. "Creo always likes to be in charge of what it's doing," a spokesperson told me, and may not wish to see its large chunk of Printcafe become so many shares of EFI stock. At Graph Expo in October, Creo launched Synapse Link--part of its Networked Graphic Production initiative--for the exchange of information between a Prinergy system and Printcafe's Hagen OA MIS system. But, Creo insists, the plan always was to work with other MIS systems, and "if Printcafe isn't on our team, that's okay--the work continues."
From EFI's point of view, the acquisition of Printcafe will help its expansion into the commercial printing market. EFI's Mimi Sells says, "EFI has a strong workflow on the shop floor; Printcafe has a strong workflow in the back office." Put the two together, and "we can offer an end-to-end workflow solution."
Whether Printcafe's stockholders vote to accept the EFI acquisition, and whether Printcafe's large printing customers will look forward to being EFI customers, remain to be seen. Nonetheless, it does my heart good to see a dot-com be the center of such a public Bachelorette-esque rivalry. Perhaps there's life in the e-commerce revolution yet. Can a turnaround in the economy be far behind?