Portals to acquire Fedrigoni’s Security business

Richard Stuart-Turner
Thursday, April 29, 2021

Portals is set to acquire Fedrigoni’s Security business, which specialises in the production of security features.

Nespolo said Fedrigoni is placing its people "in excellent hands"
Nespolo said Fedrigoni is placing its people "in excellent hands"

The specialist banknote and security paper manufacturer has entered into a transaction with Italian paper producer Fedrigoni for the potential purchase of the Security arm, which is based in Bollate, Italy, along with its assets and employees.

The business includes an extensive portfolio of security features for banknote applications and other security documents, as well as a production plant. This transaction is expected to complete in late 2021, following customary approvals.

In a separate agreement, Portals is also acquiring an option to potentially purchase certain banknote paper and passport paper assets, including production machinery, from Fedrigoni‘s Fabriano security division in Italy.

This agreement will be subject to a put and call option which may be exercised by each of the parties by the end of 2021, following the closing of the Bollate transaction.

Portals CEO Ross Holliday said: “We look forward to the completion of the transactions and to welcoming Fedrigoni’s skilled and experienced Bollate team to Portals as we continue to develop a leading, integrated security paper business.

“This transaction will enable Portals to develop and deliver more quickly and efficiently, the leading security products our customers require.”

Portals has a history stretching back over three centuries and became an independent business again in early 2018, when De La Rue sold a majority stake to the management team and private equity firm Epiris.

Last year the business completed a £20m-plus revamp that included a major rebuild of the PM1 paper machine at its Overton site in Hampshire.

As well as paper for banknotes and passports, Portals also makes security paper for other applications such as certificates and brand protection. The business also has another site in Bathford, near Bath, and currently employs around 500 people in total across its two sites. Its turnover was £134m in 2020.

“We are proud that an established international player in the banknote and security papers business, who intends to invest and expand, has expressed strong interest to acquire our Security business based on the value of our technology and the know-how of our people, who we are placing in excellent hands,” said Fedrigoni Group chief executive Marco Nespolo.

Around 100 Fedrigoni employees will join a new Italian registered company called Fase, which has been established to allow the Security business transaction.

This comprises the staff working at the Bollate plant, including the commercial team and support staff connected to the Security business.

Following the Bollate acquisition, Portals said it will be able to provide its clients with an improved and integrated proposition offer of both paper as well as security threads and foils and will significantly accelerate investment in an integrated innovation strategy.

Portals intends to continue security thread and foil production in Bollate and invest in innovation capacity across its facilities.

Portals chief commercial officer Laura Wheeler told Printweek the Italian team would remain based in Bollate and that “with an increase in innovation, we will have new roles in the future”.

On future branding, Wheeler added that from a marketing perspective the Portals brand is strong in the markets in which both companies operate “and so we intend to use this as it will be familiar with our customers”. However, the actual name of the Italian company is yet to be confirmed, she said.

If the transaction relating to certain assets located in Fabriano goes ahead, certain machinery and equipment used for the production of banknote and passport papers will be sold to Portals.

The personnel, plant, and certain critical assets, including the mould machine, would remain with Fedrigoni to develop the Art & Drawing business, which includes art papers and quality printing papers, both of which the manufacturer said are expanding quickly and will be developed further.

Fedrigoni Group is being assisted by Poyry as financial advisors, Latham & Watkins as legal M&A advisors, PwC and NDA on financial matters, Pirola Pennuto Zei on tax matters, and Golder on health, safety, and environmental aspects.

Portals, meanwhile, is being assisted by CMS as legal advisor, KPMG for finance and tax matters, Searchlight Consulting for IT, and RPS for environmental due diligence.

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