“The end of PaperlinX in the UK came as a shock to many, not because the merchant went into administration but because right up until the end a vast majority in our industry were convinced there would be some pre-pack agreement.  I won’t even comment on the irony of that,” says Mario di Lieto, managing director, Lumipaper - Stora Enso Paper.

Di Lieto responded to a question put to him by SignLink's sister title Print Monthly about what impact the demise of the overall business in the UK would have on the market, and on businesses such as his.

The acquisition has been formerly made by a newly formed subsidiary of Vink, ‘Quantum Europoint’. It now forms part of a group that includes Amari Plastics in the UK, Laird Plastics and Port Plastics in the USA, and Dotmar Industries in Australisa.

Di Lieto continues: “In a declining market PaperlinX’s demise creates a number of major issues.  By the time you read this most will have re-organised their supply routes.  Printers will have transferred their purchasing to alternative suppliers and manufacturers will have found new routes to market.  As the market breathes a collective sigh of relief the reality of trade credit and credit insurance will start to hit home.

“There is a general expectation that there will be failures amongst the printer community, particularly amongst those unable to find sufficient credit.  Few have given thought to the issue of merchant credit lines.  The demise of PaperlinX will see a major reduction in the value of credit available to the market as a whole.  If the market cannot increase the value of credit available then we must learn to use it more efficiently.  The obvious way will be to reduce debtor days and bring payment days down to sensible levels and if suppliers are going to continue acting as a bank for their customers they should at least get a realistic return for the risk.”

Di Lieto concludes: “It is probable that we will see a more cautious approach to credit in the market place from suppliers and merchants. It will be born from a natural instinct for self-preservation and nourished by some highly risk averse insurers. The demise of PaperlinX has had an immediate impact in forcing mills and printers alike to find alternatives to their traditional supply chain, but it is in the financing and the credit lines that PaperlinX’s absence will be most practically felt.”

This concludes a frenzied few weeks with bids rising and falling away like the tide from players such as Antalis, a failed crowdfunding big backed by former Paperlinx CEO Andrew Price, the buying of the companies Reel Paper and Savory Paper divisions by Premier Paper, the vulture like squabbling and securing of the wider-companies brands and assets by competitors, and the incandescent fury of former staff and share-holders.

Vink Holdings was founded in 1969 and is a heavily diversified company that has already had business dealings with Robert Horne.  In 2008 Robert Horne bought some of its business assets in order to expand further into the sign and graphics market and become a more comprehensive supplier of wide-format media and print technology. Today it is headquartered in Belgium and counts more than 900 individual businesses within a portfolio that spans everything from transparent plastics and piping systems, to construction materials LED lighting solutions for built-up signage.

The acquisition of Paperlinx VTS business will now make the company the most diversified distributor to the visual communications sector in Europe. Its signs, graphics, and wide-format print wind now covers plastic sheeting, self-adhesive vinyls, digital printing films and thermal transfer textiles under its Spectrum brand, its aluminium sign systems division, and finally its highly profitable LED lighting wing.

Print Monthly also secured reaction on the Paperlinx saga from key sector-competitor Antalis UK which also straddles the commercial print, paper, and wide-format media business.

The company’s national sales director, Bruce Munro, answered the same question put to Stora Enso about the impact of the crisis: “Following the Paperlinx announcement, we have created a dedicated new business team that can deal with any new customer enquiries or concerns, and quickly open and process new accounts. For those looking to open a credit account with Antalis, I would advise that it’s critical for printers to share their statutory and management account information, so that we can process their applications in the quickest timeframe.
“Prior to the announcement, Antalis ensured stock levels were at a higher than average level, and we are in daily contact with our suppliers to keep these stock levels sufficient to the market requirements.  We are also in continual discussions with suppliers, with the aim of bringing on board new products, as and when we see the market demand.”

Quantum Europoint will now be a major name to contend with in the industry and will operator out of Robert Horne’s former Northampton site. The firm’s registered office is in Weybridge, Surrey and was created in its current guise on April 17th 2015,  but the fact that its initial founding was under the name ‘Solidgear LTD’ on January 6t will give rise to conjecture that negotiations between Vink and Paperlinx may have been underway for some time.

This latest news puts the seal on what is a tragic story for the sign and graphics industry in the UK, as Robert Horne was for more than a hundred years a profitable and family owned business until it was bought up by Paperlinx as it diversified its market portfolio.

Looking back to a comment from former Robert Horne managing director Paul French (who was brought in to clean house at the company), it is indicative that a story which ended with the administration of Paperlinx began as early as 2010: “Everyone is aware that the industry has been going through a period of great change, with difficult times for the paper market, where there has been a decline in consumption in conjunction with price increases.

"One of the first things I needed to do was to re-energise the business to face such challenges, rather than bury our heads in the sand and expect adverse trading conditions to go away. I had to be bold and look at new directions for the business whilst never under estimating the importance of commercial print. Change is never easy so the platform had to be right.”

With French moving on from the company not long afterwards, unable to complete his mission due to the culture at the global company, his reference to the company burying its head in the sand is perhaps the best summation of what has cause a highly successful and dominant global paper business—and one of the oldest sign and graphics businesses in the UK—to go from its dizzy pre-recession heights to a low which has seen mass redundancies and market chaos.

The purchase of Paperlinx VTS by Vink will now hopefully spell the start of a new era for this troubled part of the business, but as to its wider commercial print concerns there seems little to be done but to watch as competitors dismantle it piece by piece.


If you have an interesting story or a view on this news, then please e-mail news@signlink.co.uk

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