Tuesday, December 18, 2007

Wounded Quebecor World being circled
by possible buyers

Speculation is rife that troubled printing giant Quebecor World, owned by Quebecor Inc., may be a takeover target, as its chief executive was shown the door yesterday and the company's share price plunged another 10% to $1.57 (it was more than $17 last February). According to a story in the Globe and Mail, quoting anonymous sources, U.S. printing giant R. R. Donnelly and takeover specialist funds Kohlberg Kravis Roberts & Co., Cerberus Capital Management LP and QW's crosstown rival Transcontinental Inc. are among those eyeing the wounded company.

It was announced by Quebecor Inc. boss Pierre Karl Péladeau that CEO Wes Lucas, who has been with the company less than two years, has left to pursue other opportunities, replaced by chief financial officer Jacques Mallette. Péladeau.
[Péladeau] wants the new boss at Quebecor World to cut any remaining fat at the company and the word is out that each unit must sink or swim, a source said.

Quebecor World has already been through several waves of cost cutting over the past years as it struggles with difficult market conditions and razor-thin margins.

Some analysts warned last week that the company faces an uncertain future, and possibly insolvency, in the face of a potential liquidity crisis.

For background, see earlier posts on this company.



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