Ilford Purchased by Pemberstone Ventures Ltd

Roger Cole · Sep 14, 2015

wildbill said:
if film/paper prices stay the same or decrease, great. If they go up, that won't be good for anyone but pemberstone. I'd really like to continue buying ilford's stuff.

There's enough competition in black and white to prevent prices going out of control. I'm willing to pay some premium for Ilford, especially for unique products (Delta 3200 comes to mind) but even that only within limits

Sent from my iPhone using Tapatalk and 100% recycled electrons - because I care.

Sal Santamaura · Sep 14, 2015

To clear up lots of wild speculation and misinformation in this thread, here are some facts.

Five managing directors, of whom Simon Galley was one, purchased the business (not including real estate) from the receiver in 2005, and have privately held it since.
A 20-year site lease was obtained at that time, so it has 10 years remaining.
The site's owner, LPC Living, applied to Cheshire East Council last year for permission to further develop the site. The Council rejected that application.
An appeal of LPC's development plan rejection has been filed with the central government. A public hearing for that appeal will occur next year and a decision on whether to overturn it reached after that.
The redevelopment plan indicates that LPC Living would be paying for relocation of HARMAN's equipment, including coating line, to smaller facilities on the site.

I've long said that the two greatest threats to ongoing HARMAN operations were the end of its site lease and insufficient interest on the part of its owners' children in carrying on the business. Simon has remained silent for some days now. Unless and until he or one of the other former owners chimes in to explain their reasons for selling, we won't know what the ultimate motivation was. It is likely, however, that the new owner's decisions on how to operate over the next decade need not be made taking into consideration any costs of site development, since that burden has been LPC's alone since the plan was submitted in 2014.

richyd · Sep 14, 2015

Usually this type of deal ends up bad for all concerned apart from the VC partners who look after themselves, don't necessarily understand or care about the market, load up the company with debt, strip everything to the bone but make sure they financially engineer the thing to line their own pockets for however long they can. That's the cynical viewpoint but we shouldn't pre judge and wait to see what transpires. Fills me with worry though.

Hatchetman · Sep 14, 2015

richyd said:
Usually this type of deal ends up bad for all concerned apart from the VC partners who look after themselves, don't necessarily understand or care about the market, load up the company with debt, strip everything to the bone but make sure they financially engineer the thing to line their own pockets for however long they can. That's the cynical viewpoint but we shouldn't pre judge and wait to see what transpires. Fills me with worry though.

This is exactly right. Short term investors hoping to prop up apparent profit margins in the short term so they can sell out to a bigger fool. How do you raise profits? Cut costs...QC, unprofitable SKUs, raise prices. This could be downright horrific news given Ilford's dominance in B&W paper.

RobC · Sep 14, 2015

Sal Santamaura said:
To clear up lots of wild speculation and misinformation in this thread

You'll be lucky, thats what web forums excel at.

Roger Cole · Sep 14, 2015

Hatchetman said:
This is exactly right. Short term investors hoping to prop up apparent profit margins in the short term so they can sell out to a bigger fool. How do you raise profits? Cut costs...QC, unprofitable SKUs, raise prices. This could be downright horrific news given Ilford's dominance in B&W paper.

Foma and Adox both make good black and white papers. I was about to change over to all Ilford when I used up my Adox but I could happily enough stay with Adox for neutral toned prints (and explore some of the Foma warm offerings.)

That said I'd really hate to give up Ilford paper, especially but not limited to MGWT FB. But I doubt it will be a problem in the near term.

Ken Nadvornick · Sep 14, 2015

Sal Santamaura said:
To clear up lots of wild speculation and misinformation in this thread, here are some facts.

Five managing directors, of whom Simon Galley was one, purchased the business (not including real estate) from the receiver in 2005, and have privately held it since.

A 20-year site lease was obtained at that time, so it has 10 years remaining.

The site's owner, LPC Living, applied to Cheshire East Council last year for permission to further develop the site. The Council rejected that application.

An appeal of LPC's development plan rejection has been filed with the central government. A public hearing for that appeal will occur next year and a decision on whether to overturn it reached after that.

The redevelopment plan indicates that LPC Living would be paying for relocation of HARMAN's equipment, including coating line, to smaller facilities on the site.

I've long said that the two greatest threats to ongoing HARMAN operations were the end of its site lease and insufficient interest on the part of its owners' children in carrying on the business. Simon has remained silent for some days now. Unless and until he or one of the other former owners chimes in to explain their reasons for selling, we won't know what the ultimate motivation was. It is likely, however, that the new owner's decisions on how to operate over the next decade need not be made taking into consideration any costs of site development, since that burden has been LPC's alone since the plan was submitted in 2014.

That's as may be, and we may never know why the managing directors sold out. But it doesn't address the question of why a venture capital firm decided to buy in.

However, I bet I can make a good guess...

Ken

MartinP · Sep 14, 2015

Well, the simplest way to make a profit is for the new owner to borrow on the assets of Harman and invest those funds indirectly in another of their businesses, or remove it from reach in another way. Harman then go broke and the investors who made the new loans to Harman are creditors in the scrapping of the company assets, while the funds they lent have 'disappeared'.

Some of the complaints to the planning enquiry seem to have been worrying about the increased size of the village with the partial redevelopment of the site, so I suppose that most of the 250 employees at Harman do not live next to the works.

Possibly we have five to ten years to arrange funding and a location for the R&D sized coater, currently at Harman, in a similar way to that done by Adox with the old Gevaert machinery. Any offers?

Bob Carnie · Sep 14, 2015

I am just happy that years back somewhere here on APUG Harman assured us they will be the last ones standing in BW.

Ai Print · Sep 14, 2015

I truly don't envy Simon right now.

He has pretty much been gleefully overblown to being the "Photo-Pope-Francis" on what is the only forum he actively participates in under his name ( to my knowledge ), to the point of some members bashing the snot out of other film brands in act of grade school level fanboysim.

Now the ownership has changed dramatically, the very notion of his actual participation is a big fat question mark as is who will take over his role as being the community connection to the brand, if anyone.

Regardless, I applaud his years of service that he gave this site, it has got to be one of the toughest crowds to please when it comes to the film based medium.

But yeah, this is going to get very interesting in the coming months.

MDR · Sep 14, 2015

Ai Print said:
I truly don't envy Simon right now.

He has pretty much been gleefully overblown to being the "Photo-Pope-Francis" on what is the only forum he actively participates in under his name ( to my knowledge ), to the point of some members bashing the snot out of other film brands in act of grade school level fanboysim.

Now the ownership has changed dramatically, the very notion of his actual participation is a big fat question mark as is who will take over his role as being the community connection to the brand, if anyone.

Regardless, I applaud his years of service that he gave this site, it has got to be one of the toughest crowds to please when it comes to the film based medium.

But yeah, this is going to get very interesting in the coming months.

+1 can't agree more

georg16nik · Sep 14, 2015

Well, at least Ilford's customers are given the “civilized” heads-up, a few years in advance.

Xmas · Sep 14, 2015

The Agfa Leverkusen site was sold about ten years ago, operated for several months and then declared bankrupt...

Noel

pentaxuser · Sep 14, 2015

I presume that Harman has known about the Venture Capitalist purchase for some time i.e. Harman wasn't purchased on a whim on Saturday last so Harman and the face of Harman who is Simon Galley on APUG has had a while to prepare a statement for APUG post the announcement on the Harman site

He may be constrained in what he can say for the time being of course but he can surely tell APUG if and when he can tell us more

I am trying to think of good reasons why he can't post anything and if we hear nothing at all in the next few days then this fills me with foreboding.

pentaxuser

Thomas.Goehler · Sep 14, 2015

I wonder what Henning Serger would say now, just weeks after his over-optimistic future outlook concerning film-based photography ...

mr rusty · Sep 14, 2015

why oh why all the negativity. The investment can't be for property - Ilford only have a lease. Therefore the investment is the company. Older guys nearing retirement have to make difficult choices. I am sure this is a very informed decision, but as a niche specialist who doesn't own their factory, it's not a company with much in the way of assets to strip, so the investment should be taken at face value - investment in the future. And why not.

The fact that ownership has changed, also doesn't necessarily mean that the line up of executive directors has changed. I expect there will a new face on the board representing the investors, but otherwise we have to wait and see.

Just get on with life, buy film, shoot film and enjoy it.

Ai Print · Sep 14, 2015

pentaxuser said:
I presume that Harman has known about the Venture Capitalist purchase for some time i.e. Harman wasn't purchased on a whim on Saturday last so Harman and the face of Harman who is Simon Galley on APUG has had a while to prepare a statement for APUG post the announcement on the Harman site

He may be constrained in what he can say for the time being of course but he can surely tell APUG if and when he can tell us more

I am trying to think of good reasons why he can't post anything and if we hear nothing at all in the next few days then this fills me with foreboding.

I tend to agree, have a gut feeling he will reply once all the usual suspects have weighed in.

But I hope that regardless of what he has to say and what if any future participation he decides engage in on this site, people treat him with the respect he has so rightly earned.

pentaxuser · Sep 14, 2015

Ai Print said:
I tend to agree, have a gut feeling he will reply once all the usual suspects have weighed in.

But I hope that regardless of what he has to say and what if any future participation he decides engage in on this site, people treat him with the respect he has so rightly earned.

Well having seen him in the flesh so to speak I'd say he is too young to instantly retire so hopefully he will stay on at Harman for the future unless his share from the Pemberstone purchase is large enough allow instant retirement. It can't be ruled out and we have no information on what Pemberstone plans are for the senior directors.

Frankly, who knows?

We are in the dark

pentaxuser

Thomas.Goehler · Sep 14, 2015

sorry, double posting

cmacd123 · Sep 14, 2015

well being bought out by a VC firm is statistically a bit scary for ongoing firms.

We can HOPE that this is good news, with patient management who have extra capital available to promote the ilford range, perhaps do positive things like finance the production of a new range of "Ilford Sportsman" cameras aimed at the young upcoming photographers. perhaps R&D of new lines of papers or a fresh take on B&W film.

Maybe just some extra capabilities like providing OEM components like Cassettes to the smaller player like Foma, and ADOX.DE

Or it could be that the firm that owns Ilfords site is also being bought be a related firm, and this will allow Ilford to agree to cancel their lease early and close down, freeing the site for redevelopment.

It does perhaps explain why Simon has not been posting at his normal rate, as he many be in a legal quiet period over this transaction, no matter what the long term holds.

Interestingly Many of us will have the natural inclination to put away a bunch of white boxes with black lettering in our freezers, which will itself produce a Bump in short term sales.

They say the forum is not for "speculation" so I will not attempt to lay odds on these outcomes happening. just hope for the best. I did note that the rather short press release did not have any metion as to who will be running the new venture, either in the form of New management being appointed or anything about the current management staying in place.

Uncle Bill · Sep 14, 2015

I took a quick look at the Pemberstone Ventures website just to see what they are all about, looks like they are a privately held holding company owning both property and an ownership position in the diverse portfolio of firms in a variety of industries. I'm not going to panic yet, there's no sense, if it's the case the people behind Ilford Photo were looking for a succession plan, no doubt they did their due diligence on Pomberstone as Pemberstone did on Ilford, this wasn't an impluse buy.

RattyMouse · Sep 14, 2015

Hard to think of two words I detest more: Venture Capital.

Sirius Glass · Sep 14, 2015

I am pessimistic because my experience with Venture Capitalists is that they specialize in raping and pillaging the new acquisitions and then leave the bodies to rot. I hope that these new owners will prove me very wrong.

Barry S · Sep 14, 2015

Harman has consistently been one of the best analog manufacturers for numerous reasons. Unlike some larger companies--the whole is worth far more than the sum of its parts. They've worked hard to balance serving the analog community against creating a sustainable business. Unless someone has information showing this VC firm looting and pillaging other companies, maybe we should give Harman the benefit of the doubt. Maybe they see a potential for expanding the existing business--which could be a good way of making money and serving the analog community.

pdeeh · Sep 14, 2015

Have they bought a company called Harmon as well then ?

Ilford Purchased by Pemberstone Ventures Ltd

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