Reflex Labels acquires Labelsco
By Hannah Jordan Wednesday, 17 October 2012
The £50m turnover Mansfield-headquartered packaging firm has purchased label printers Labelsco for an undisclosed sum.
Reflex Labels, which employs over 300 people across six manufacturing sites and four reprographic sites, completed the 100% acquisition of the Leicestershire-based label and laminate printing specialist on 8 October.
It sees the company take over Labelsco’s 7,000sqm Barwell printing facility along with nine flexo-presses and around 90 employees.
Accounts registered on Companies House for the year ended 31 December 2011 show that Labelsco, which had been operating as a going concern, made an operating loss of £639,182 with net liabilities of £356,978. Total loss for 2011 amounted to £1.2m, with total losses of £986,000 in 2010.
In the 2011 end of year report Labelsco directors David Walsh and David Seymour, both of whom departed the company as a result of Reflex Labels’ acquisition, cited a combination of circumstances, including a group restructuring and transfer of company ownership to a new holding company, as cause for "significant doubt of the company’s ability to continue as a going concern".
Reflex Labels group managing director Ian Kendall said that the acquisition had "needed a quick conclusion" but that Reflex Label’s strong position in the market meant that it was able to easily take on Labelsco’s responsibilities.
He added: "We are the second largest label company in the UK – the strength of our balance sheet means this is not a risk for us."
Kendall said that key creditors had already been "satisfied" and that he expected to have Labelsco, which will continue to trade under the same name within the Reflex group, "up on its feet and creating profit within weeks and months, not years".
According to Kendall the deal will boost Reflex Label’s turnover by up to £10m - bringing its total annual turnover to a projected £60m - and expand its product range to include specialist pharmaceutical printing, screen print and braille.
He added: "Labelsco has a great portfolio of customers but has sold a limited product range to them so we will look to expand our sales to those customers.
Kendall said that the long term plan would be to grow production and staff levels at the Barwelll site, making full use of the "fantastic amount of space" afforded by Labelsco’s facility. But he said the immediate future would be focussed on improving working practices at the site.
"We are consolidating Labelsco’s position in the business to make it profitable and then we will look to expand. Barwell is a very large building which has significant potential so after a period of consolidation and developing a more efficient way of running Labelsco we will then look to growing it and taking on more staff."
The acquisition comes just over a year after Reflex Labels acquired the assets and goodwill of Midlands-based Plain Labels Company after in fell into administration.
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