X-Rite Expands European Market

June 7, 2004
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GRANDVILLE — X-Rite Inc. has acquired all the operating assets, software code and intellectual property of Moniga Gremmo S.r.l., a small, privately held company based in Milan, Italy.

Moniga Gremmo serves customers in the industrial color and appearance business for the formulation of inks, as well as plastics.

Moniga Gremmo is X-Rite’s fourth acquisition in Europe.

Spokesman Tyler Andrew said X-Rite is not publicly disclosing the purchase price or whether it was a cash-only or a combination of cash and stock transaction.

He also declined to reveal the Italian company’s annual revenues and number of employees.

It’s a very small company with very few employees and virtually no hard assets, said Mary Chowning, vice president and CFO.

“The reason we bought it was to acquire their software and software code. They have proprietary software in the ink and color formulation markets, so it’s a good match for our product line.”

There’s kind of a materiality threshold and a very small acquisition like Moniga Gremmo doesn’t meet it, she said.

“If we purchase a company, the SEC has some rules about filing an 8K and clearly this doesn’t meet the minimum requirements for an 8K filing, so it’s not considered to be a material transaction.”

Though it’s a very small company, it’s a strategic move for X-Rite, Chowning observed.

“Oftentimes you’ll find a company that’s got a product that really complements and matches nicely with your company product and together they have more value than they do on a standalone basis.”

X-Rite already has taken all Moniga Gremmo’s operations and merged them with X-Rite’s Milan operation, she said.

Andrew said the company is working right now on integrating the features of Moniga Gremmo software into X-Rite’s color master formulation software that it uses worldwide.

Europe is a target market for growth for X-Rite, he noted, and the Moniga Gremmo software product already has a following primarily in Italy, but it’s also used in France and other neighboring European countries.

Those markets automatically became X-Rite’s upon purchase of the company.

“We wanted to build a better offering to attract those customers and strengthen the overall software offering that we have for this industry,” Andrew added.

Xavier Leroy, managing director of X-Rite Mediterranee, runs X-Rite’s France and Italy operations.

Leroy scouted out Moniga Gremmo and was instrumental in its acquisition.

“He discovered that some of the features that they had in their software would enhance our software offering,” Andrew said, “and one of the things that X-Rite has been focusing on recently is combining software and hardware for a total solution.”

Locally, X-Rite has been perceived as an instrument company for a long time, he pointed out.

X-Rite’s 2003 acquisition of all Manoco Systems’ lines of color-management products, intellectual property and operating assets, now combined with the purchase of Moniga Gremmo, better positions X-Rite’s software offering “to bring our customers a full color management solution,” he said.    

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