Matthews International Announces Closing of SGK Brand Solutions Sale
Matthews International (MATW) has completed the sale of its SGK Brand Solutions business to a new entity formed with SGS & Co. The transaction terms include $350 million in upfront consideration, comprising $250 million in cash, $50 million in preferred equity, and $50 million in retained trade receivables. Matthews will maintain a 40% common equity stake in the new company.
The cash proceeds will be used to reduce Matthews' debt and strengthen its balance sheet. The new entity, led by former SGK Group President Gary R. Kohl as CEO, expects to achieve over $50 million in annual cost synergies and growth opportunities within 30 months. Matthews will report its investment using the equity method of accounting, with SGK no longer fully consolidated in the company's financial statements.
Matthews International (MATW) ha completato la vendita del suo settore SGK Brand Solutions a una nuova entità costituita insieme a SGS & Co. I termini della transazione prevedono un pagamento iniziale di 350 milioni di dollari, suddiviso in 250 milioni in contanti, 50 milioni in equity preferenziale e 50 milioni in crediti commerciali trattenuti. Matthews manterrà una quota del 40% del capitale ordinario nella nuova società.
Il ricavato in contanti sarà utilizzato per ridurre il debito di Matthews e rafforzare il suo bilancio. La nuova entità, guidata dall'ex presidente del gruppo SGK, Gary R. Kohl, come CEO, prevede di ottenere oltre 50 milioni di dollari in sinergie di costo annuali e opportunità di crescita entro 30 mesi. Matthews contabilizzerà il suo investimento con il metodo del patrimonio netto, e SGK non sarà più consolidata integralmente nei bilanci della società.
Matthews International (MATW) ha completado la venta de su negocio SGK Brand Solutions a una nueva entidad formada junto con SGS & Co. Los términos de la transacción incluyen un pago inicial de 350 millones de dólares, compuesto por 250 millones en efectivo, 50 millones en acciones preferentes y 50 millones en cuentas comerciales retenidas. Matthews mantendrá una participación del 40% en acciones comunes en la nueva compañía.
Los ingresos en efectivo se utilizarán para reducir la deuda de Matthews y fortalecer su balance. La nueva entidad, liderada por el ex presidente del grupo SGK, Gary R. Kohl, como CEO, espera lograr más de 50 millones de dólares en sinergias de costos anuales y oportunidades de crecimiento en un plazo de 30 meses. Matthews reportará su inversión utilizando el método de participación, y SGK dejará de consolidarse completamente en los estados financieros de la empresa.
Matthews International (MATW)는 SGK 브랜드 솔루션 사업부를 SGS & Co.와 함께 설립한 새로운 법인에 매각을 완료했습니다. 거래 조건에는 3억 5천만 달러의 선불 대금이 포함되며, 이는 현금 2억 5천만 달러, 우선주 5천만 달러, 미수금 5천만 달러로 구성됩니다. Matthews는 새 회사에서 보통주 40% 지분을 유지할 예정입니다.
현금 수익금은 Matthews의 부채를 줄이고 재무 상태를 강화하는 데 사용됩니다. 전 SGK 그룹 사장 Gary R. Kohl가 CEO로 이끄는 새 법인은 30개월 내에 연간 5천만 달러 이상의 비용 시너지 및 성장 기회를 달성할 것으로 기대합니다. Matthews는 지분법 회계로 투자를 보고하며, SGK는 더 이상 회사 재무제표에 완전 연결되지 않습니다.
Matthews International (MATW) a finalisé la vente de sa division SGK Brand Solutions à une nouvelle entité créée avec SGS & Co. Les conditions de la transaction prévoient un paiement initial de 350 millions de dollars, comprenant 250 millions en espèces, 50 millions en actions privilégiées et 50 millions en créances commerciales conservées. Matthews conservera une participation en actions ordinaires de 40% dans la nouvelle société.
Les liquidités seront utilisées pour réduire la dette de Matthews et renforcer son bilan. La nouvelle entité, dirigée par l'ancien président du groupe SGK, Gary R. Kohl, en tant que PDG, prévoit de réaliser plus de 50 millions de dollars en synergies de coûts annuelles et opportunités de croissance dans les 30 mois. Matthews comptabilisera son investissement selon la méthode de la mise en équivalence, et SGK ne sera plus consolidée intégralement dans les états financiers de l'entreprise.
Matthews International (MATW) hat den Verkauf seines SGK Brand Solutions-Geschäfts an eine neu gegründete Gesellschaft zusammen mit SGS & Co. abgeschlossen. Die Transaktionsbedingungen umfassen eine Vorabzahlung von 350 Millionen US-Dollar, bestehend aus 250 Millionen US-Dollar in bar, 50 Millionen US-Dollar in Vorzugsaktien und 50 Millionen US-Dollar an einbehaltenen Handelsforderungen. Matthews behält einen 40%igen Stammaktienanteil an dem neuen Unternehmen.
Die Barmittel werden zur Schuldenreduzierung und zur Stärkung der Bilanz von Matthews verwendet. Das neue Unternehmen, unter der Leitung des ehemaligen SGK-Gruppenpräsidenten Gary R. Kohl als CEO, erwartet innerhalb von 30 Monaten über 50 Millionen US-Dollar an jährlichen Kostensynergien und Wachstumschancen. Matthews wird seine Beteiligung nach der Equity-Methode bilanzieren, und SGK wird nicht mehr vollständig in den Konzernabschlüssen des Unternehmens konsolidiert.
- Immediate cash infusion of $250 million to reduce debt and strengthen balance sheet
- Retention of 40% common equity stake plus $50M preferred equity in the new entity
- Expected $50M+ in annual cost synergies and growth opportunities within 30 months
- Strategic focus on core businesses while maintaining upside potential through minority interest
- Loss of full control and consolidation of SGK Brand Solutions revenue stream
- Dependence on new entity's execution to realize value from retained equity stake
Insights
Matthews sells SGK for $350M, reduces debt while maintaining 40% equity stake in new entity with $50M annual synergy potential.
This $350 million transaction provides Matthews International with immediate value through multiple streams: $250 million in cash, $50 million in preferred equity, and $50 million in retained trade receivables. The company maintains significant upside potential through its 40% common equity stake in the newly formed entity combining SGK with SGS.
The cash proceeds will be used to significantly reduce Matthews' outstanding debt, strengthening the balance sheet and enhancing financial flexibility. This debt reduction comes at an opportune time, positioning the company for future strategic initiatives.
From an accounting perspective, Matthews will transition to the equity method for this investment, meaning SGK's operations will no longer be fully consolidated in financial statements. This represents a material reporting change for investors analyzing the company going forward.
The projected $50+ million in annual cost synergies and growth opportunities expected over the next 30 months adds substantial potential value to Matthews' equity stake. The appointment of former Matthews executive Gary Kohl (who previously led SGK for seven years) as CEO provides leadership continuity and operational expertise to maximize the combined entity's potential.
Strategic divestiture maintains upside through 40% ownership while refocusing on core businesses and strengthening balance sheet.
This transaction marks a pivotal strategic shift for Matthews International, explicitly described as accelerating the company's "strategic focus on core businesses" while maintaining significant exposure to SGK's future. The sophisticated deal structure balances immediate financial benefits with long-term strategic value.
The combination of SGK with SGS creates what the companies project will be "a leading global provider of brand solutions" with enhanced scale and capabilities. By maintaining 40% common equity ownership alongside $50 million in preferred equity, Matthews preserves meaningful participation in the combined entity's future success while immediately strengthening its financial position.
The leadership selection demonstrates strategic continuity, with former Matthews executive Gary Kohl taking the CEO role after seven years leading SGK within Matthews. This governance approach maintains valuable institutional knowledge while enabling operational independence.
Most tellingly, the press release indicates this transaction occurs within a broader strategic context, stating "The Board's broader strategic review of Matthews' portfolio remains ongoing." This reveals the SGK divestiture is likely one component of a more comprehensive corporate realignment focused on optimizing the company's business portfolio and capital allocation to maximize shareholder value.
PITTSBURGH, May 01, 2025 (GLOBE NEWSWIRE) -- Matthews International Corporation (NASDAQ GSM: MATW) (“Matthews” or the “Company”) today announced the successful closing of the sale of its SGK Brand Solutions business (“SGK”) to a newly formed entity created by affiliates of SGS & Co (“SGS”). The transaction combines SGK and SGS into a new company that is expected to be a leading global provider of brand solutions.
Under the terms of the transaction, Matthews received upfront consideration of
The cash proceeds will be used to significantly reduce Matthews’ outstanding debt, strengthening the Company’s balance sheet and positioning it for future strategic initiatives. The new entity, led by Gary R. Kohl as Chief Executive Officer and Matthew T. Gresge as Executive Chairman, is projected to realize more than
“We are pleased to have successfully closed this transaction,” said Joseph C. Bartolacci, President and Chief Executive Officer of Matthews International. “The sale of SGK accelerates our strategic focus on our core businesses while substantially improving our financial flexibility. We believe the new entity, under Gary’s proven leadership, is well-positioned for strong performance, and Matthews will continue to benefit from its future growth through our minority interest.”
“This combination creates a powerful platform for growth and innovation,” said Gary R. Kohl, Chief Executive Officer of the new entity. “Together, SGK and SGS bring unparalleled capabilities to our clients worldwide. We are excited about the opportunities ahead and deeply appreciate the support from Matthews as we launch this next chapter.”
Matthews will report its investment in the new entity under the equity method of accounting, with the SGK business no longer fully consolidated in the Company’s financial statements.
The Board’s broader strategic review of Matthews’ portfolio remains ongoing, underscoring the Company’s commitment to maximizing shareholder value.
About Matthews International
Matthews International Corporation operates through two core global businesses – Industrial Technologies and Memorialization. Both are focused on driving operational efficiency and long-term growth through continuous innovation and strategic expansion. The Industrial Technologies segment evolved from our original marking business, which today is a leading global innovator committed to empowering visionaries to transform industries through the application of precision technologies and intelligent processes. The Memorialization segment is a leading provider of memorialization products, including memorials, caskets and cremation and incineration equipment, primarily to cemetery and funeral home customers that help families move from grief to remembrance. The Company has over 5,400 employees in 19 countries on four continents that are committed to delivering the highest quality products and services.
Forward Looking Statements
Any forward-looking statements contained in this release are included pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements regarding the expectations, hopes, beliefs, intentions or strategies of the Company regarding the future, including statements regarding the anticipated timing and benefits of the proposed joint venture transaction, and may be identified by the use of words such as “expects,” “believes,” “intends,” “projects,” “anticipates,” “estimates,” “plans,” “seeks,” “forecasts,” “predicts,” “objective,” “targets,” “potential,” “outlook,” “may,” “will,” “could” or the negative of these terms, other comparable terminology and variations thereof. Such forward-looking statements involve known and unknown risks and uncertainties that may cause the Company’s actual results in future periods to be materially different from management’s expectations, and no assurance can be given that such expectations will prove correct. Factors that could cause the Company’s results to differ materially from the results discussed in such forward-looking statements principally include our ability to achieve the anticipated benefits of the joint venture transaction that recently closed, changes in domestic or international economic conditions, changes in foreign currency exchange rates, changes in interest rates, changes in the cost of materials used in the manufacture of the Company’s products, including changes in costs due to adjustments to tariffs, any impairment of goodwill or intangible assets, environmental liability and limitations on the Company’s operations due to environmental laws and regulations, disruptions to certain services, such as telecommunications, network server maintenance, cloud computing or transaction processing services, provided to the Company by third-parties, changes in mortality and cremation rates, changes in product demand or pricing as a result of consolidation in the industries in which the Company operates, or other factors such as supply chain disruptions, labor shortages or labor cost increases, changes in product demand or pricing as a result of domestic or international competitive pressures, ability to achieve cost-reduction objectives, unknown risks in connection with the Company’s acquisitions, divestitures, and business combinations, cybersecurity concerns and costs arising with management of cybersecurity threats, effectiveness of the Company’s internal controls, compliance with domestic and foreign laws and regulations, technological factors beyond the Company’s control, impact of pandemics or similar outbreaks, or other disruptions to our industries, customers, or supply chains, the impact of global conflicts, such as the current war between Russia and Ukraine, the Company’s plans and expectations with respect to its exploration, and contemplated execution, of various strategies with respect to its portfolio of businesses, the Company’s plans and expectations with respect to its Board, and other factors described in the Company’s Annual Report on Form 10-K and other periodic filings with the U.S. Securities and Exchange Commission.
Matthews International Corporation
Corporate Office
Two NorthShore Center
Pittsburgh, PA 15212-5851
Phone: (412) 442-8200
| Contact: | Steven F. Nicola | |
| Chief Financial Officer | ||
FAQ
How much did Matthews International (MATW) sell SGK Brand Solutions for?
What ownership stake does MATW retain in the new SGK-SGS combined entity?
How will Matthews use the proceeds from the SGK Brand Solutions sale?
What synergies are expected from the SGK-SGS merger?
Who will lead the new combined SGK-SGS entity?
