In a move that expands R.R. Donnelley's presence into new areas in the printing market and ends its search for a new CEO, the company has agreed to acquire Moore Wallace Inc. for $2.8 billion in stock. As part of the deal, Mark Angelson, CEO of Moore Wallace, will become CEO of the combined company, which will be known as R.R. Donnelley. Donnelley has been looking for a successor to its current CEO, William Davis, since July, when Davis announced he would retire.
The new company, which will be based in Chicago, will have total sales of more than $8 billion and about 50,000 employees. Moore Wallace was created in January when Moore Corp. acquired Wallace Computer Services for $1.1 billion. The company operates in three segments—forms and labels, outsourcing and commercial printing—but has no presence in book, magazine or directory printing, three of Donnelley's major markets. "That's why they're such a great fit," said a Donnelley spokesperson, citing the lack of overlap between the two companies.
Executives said they believe the merger will result in $100 million in cost savings within two years after the deal is concluded by eliminating duplicate functions such as administrative and infrastructure costs.
