<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
MARCH 10, 1998
Date of Report (Date of Earliest Event Reported)
NASHUA CORPORATION
(Exact Name of Registrant as Specified in its Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation)
1-5492-1 02-0170100
(Commission File Number) (I.R.S. Employer Identification No.)
44 FRANKLIN STREET
NASHUA, NEW HAMPSHIRE 03060
(Address of Principal Executive Offices)
(603)880-2323
(Registrant's Telephone Number, Including Area Code)
NOT APPLICABLE
(Former Name or Former Address, if Changed Since Last Report)
<PAGE> 2
- 2 -
INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 5 - OTHER EVENTS
On March 10, 1998, Nashua Corporation issued the following press release:
NASHUA CORPORATION ANNOUNCES PLAN
TO SELL PHOTOFINISHING GROUP
Will Retain Specialty Coated Products Division
Nashua, NH, March 10, 1998 -- Nashua Corporation (NYSE: NSH)
today announced that it has agreed to an unsolicited offer to sell its
photofinishing operations in the United States, United Kingdom and
Canada to a private U.S. company for $52.5 million in cash and the
assumption of certain liabilities. These units represent approximately
90% of the Photofinishing Group's $143 million 1997 revenues.
Completion of the transaction, which is subject to Federal Trade
Commission review under the Hart-Scott-Rodino Act and customary closing
conditions, is expected during the second quarter of 1998. Although the
Company's Northern Ireland photofinishing operations are not included
in this transaction, the Company is engaged in discussions with a
number of parties interested in acquiring this business. The Company
expects that net proceeds on the disposal of these businesses will
approximate net book value. Nashua intends to retain its Specialty
Coated Products unit, which the Company had previously announced in
November that it planned to sell.
Gerald G. Garbacz, Nashua's chairman, president and chief
executive officer, stated, "In the process of selling our international
photofinishing operations, we received an unsolicited bid for all of
our photofinishing business, except Northern Ireland, which was highly
attractive and which we have concluded is in the best interest of our
shareholders. As a result of our agreement, we can now focus our
attention and resources on expanding markets where Nashua's products
can be clearly differentiated, add value and generate consistent,
sustainable profitable growth. This includes our Specialty Coated
Product Division, which we are choosing to retain based on its recent
success in key strategic markets and expanding product portfolio."
As announced in early November, Nashua retained BT Alex. Brown
to assist the Company with the process of selling its international
photofinishing operations in Canada, Northern Ireland and the United
Kingdom, as well as its Specialty Coated Products Division. At that
time, the Company announced its plan to strategically focus its
resources on growing its U.S. photofinishing, imaging supplies and
label businesses. BT Alex. Brown advised the Company in connection with
the transaction announced today.
The Company, as previously indicated, expects that a portion
of the proceeds would be retained in the continuing businesses with the
remainder distributed to shareholders. The Company plans to announce
the details concerning distribution of proceeds by mid-year.
<PAGE> 3
- 3 -
NASHUA GOING FORWARD
As a result of the decision to sell its entire photofinishing
business, Nashua will now be composed of three divisions - Specialty
Coated Products, Imaging Supplies and Label. The continuing operations
of Nashua employ approximately 760 people and reported 1997 sales of
$173 million. For further financial information, please refer to
Nashua's fourth quarter and year end 1997 financial results which also
were announced today.
Garbacz continued, "By retaining our Specialty Coated Products
unit, we can properly and clearly position Nashua as a premier,
independent provider of differentiated imaging products to a broad
range of commercial and industrial customers."
SPECIALTY COATED PRODUCTS
Nashua's Specialty Coated Products Division, based in
Merrimack, New Hampshire, develops and markets chemical coatings and
adhesives that improve the imaging capability or the adhesion
characteristics of a broad range of papers and films. The Division's
imaging products range from papers coated for thermal printers and fax
machines to papers for wide-web ink jet printers. Adhesive papers
include water and heat activated papers. The Division has launched and
is scheduled to launch a number of new thermal and ink jet offerings
during 1997 and 1998 targeting a number of growing markets. The
Division, which currently employs approximately 210 people, recorded
1997 sales of $47 million, including sales to the Label Division.
IMAGING SUPPLIES
The Imaging Supplies Division provides competitive,
independently produced toners, remanufactured laser printer cartridges
and other imaging-related supplies to customers, with a particular
emphasis on high-quality Xerox and Ricoh compatible toners. In recent
months, Nashua has accelerated the introduction of new products,
expanded its manufacturing capabilities, established new distribution
agreements, and simplified its offerings and pricing. In addition, the
Division is in the process of outsourcing its order processing and
logistics operation, which is expected to improve performance and
reduce annual operating expenses by more than $1 million when fully
implemented in the second quarter of 1998. The Division, which employs
approximately 180 people, reported 1997 sales of $73 million.
LABEL
Nashua has long been recognized as a leader in the
pressure-sensitive label business, and manufacturing and distributing
products for use in data processing, information transfer and product
identification. Based in Omaha, Nebraska, Nashua's label operation
significantly upgraded its production capabilities through the
installment of five state-of-the-art presses in 1997 with further
upgrades scheduled for mid-1998. The Omaha facility has laminating
capability to service both internal requirements and the label
converting industry. The Label Division employs approximately 275
people and reported 1997 sales of $71 million.
<PAGE> 4
- 4 -
Garbacz concluded, "Our Specialty Coated Products operation
enjoys significant synergies with our pressure-sensitive label
business, improving financial performance and increasing acceptance of
its new thermal products in a number of rapidly expanding markets. We
believe that our Imaging Supplies Division has the potential for growth
due to the combination of new products being introduced and
opportunities for new strategic relationships that can further enhance
its distribution. In addition, Nashua's Label Division continues to
successfully expand its business and boost profitability. This group of
manufacturing-based businesses returns Nashua to the core operations
upon which this Company was built. I am excited by the value that this
alignment of businesses will create for Nashua's customers, employees,
business partners and shareholders."
This press release contains forward-looking statements as that
term is defined in the Private Securities Litigation Reform Act of
1995. When used in this press release, the words "is expected,"
"intends," "plans to," "believe," "expanding," "growing," "will offer"
and similar expressions are intended to identify such forward-looking
statements. Such forward-looking statements are subject to risks and
uncertainties which could cause actual results to differ materially
from those anticipated. Such risks and uncertainties include, but are
not limited to, the successful sale of its photofinishing businesses,
the Company's future capital needs, fluctuations in customer demand,
intensity of competition from other vendors, timing and acceptance of
new product introductions, general economic and industry conditions,
and other risks set forth in the Company's filings with the SEC. The
Company assumes no obligation to update the information contained in
this press release.
Nashua Corporation markets specialty imaging products and
services to industrial and commercial customers. The Company's products
include thermal papers, pressure-sensitive labels and specialty papers,
as well as copier, ink jet and laser printer supplies.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NASHUA CORPORATION
Date: March 20, 1998 By /s/ Paul Buffum
----------------
Paul Buffum
Vice President, General Counsel
and Secretary
