Quad To Acquire LSC In All-stock Deal Valued At Approx. $1.4 Bln - Quick Facts

(RTTNews) - Quad/Graphics, Inc. (QUAD) and LSC Communications, Inc. (LKSD) announced their boards have approved a definitive agreement whereby Quad will acquire LSC Communications in an all-stock transaction valued at approximately $1.4 billion, including the refinancing of LSC Communications' debt. Quad shareholders will continue to own Class A and Class B shares, representing approximately 71 percent total economic ownership of the combined company and approximately 89 percent total voting power of the combined company.

LSC Communications shareholders will receive 0.625 shares of Quad Class A common stock for each LSC Communications share they own, representing approximately 29 percent total economic ownership of the combined company and approximately 11 percent of the vote of the combined company.

Joel Quadracci will be Chairman, President and Chief Executive Officer of the combined company. Quad will expand its board of directors to include two members from LSC Communications' existing board. The transaction is expected to close in mid-2019.

Quad expects the transaction to be accretive to earnings, excluding non-recurring integration costs. Net synergies are expected to be approximately $135 million, and will be achieved in less than two years.

Separately, Quad/Graphics, Inc. announced the company narrowed full-year 2018 guidance for net sales to be approximately $4.2 billion, adjusted EBITDA of $410 million to $430 million, and free cash flow of approximately $200 million.

Quad/Graphics' next quarterly dividend of $0.30 per share will be payable on December 7, 2018, to shareholders of record as of November 19, 2018.