In a deal completed last night (5 December), Magenta will transfer from the ownership of the high street retailer and become the cornerstone of Paragon Display Solutions, a division of the group’s Graphic Services subsidiary that also includes wide-format elements of the Service Point UK business it acquired in 2014.
All 75 staff at the busines, including the management team, will transfer as well.
Taunton-based Magenta was first put up for sale in July after Debenhams issued its third profits warning of the year and announced plans to carry out a strategic review of non-core assets. Paragon became involved in talks shortly after the announcement and quickly became the exclusive candidate for the deal.
By acquiring the operation, Paragon will add around £10m in turnover, bringing the group’s projected revenue for the next financial year up to €700m (£623m).
Paragon Group integration director Angus Campbell said: “Paragon is very strong in many sectors, but large-format and display has been relatively small for us.
“Magenta brings the opportunity to expand in this field and in return we bring them independence from Debenhams.
“We have bought a vibrant business headed up by a great management team. Our intention is to take on its great factory and make the most of the room it has to grow.”
All staff at Magenta’s Taunton base will remain onsite, with “two or three” London-based staff moving into one of Paragon’s offices in the capital, according to Campbell. It has yet to be decided whether the Magenta brand will become absorbed into the wider group name.
The acquisition brings Paragon Display Solutions’ total headcount up to around 100 and adds a range of digital and conventional printing capabilities, including multiple Durst large-format printers, Xerox digital printing kit, Esko cutting tables and a five-colour Heidelberg Speedmaster CX 102 with coater.
Campbell said all kit will remain at the 5,600sqm plant and that further investments were possible in time.
While Magenta operated as a trading name of Debenhams PLC and did not file separate accounts, it did generate a “large chunk” of its work from clients other than its owner. The operation will continue to do some work for its former parent as part of the sale agreement.
“Our plan is to expand the commercial portion of the business and make a move on the upmarket display graphics market,” said Campbell. “We have established a significant working relationship with Debenhams that we hope to continue.”
Paragon has been on an acquisition spree across 2018, having opened the year by snapping up FT Solutions out of administration. This was followed in May with the purchase of Kingswood iOputs and in June it bought the last remaining print business from St Ives.
Its latest buy was £14.5m-turnover Paperhat Communications as it fell into administration last month, which is set to be merged into the Graphic Services wing alongside Magenta.