Moscow-based company T8 Publishing Technologies is planning to invest no less than 6 billion rubles (approximately $170 million) in an ambitious print-on-demand project, the Moscow authorities announced last week.
The company claims it has acquired rare printing equipment that, combined with a special electronic publication platform, enables profitable printing of any quantity of copies – even one single copy – for as little as $0.70 each.
T8 aims to use this technology to release thousands of new books on a daily basis, with the printing process only taking a few minutes per book.
“In the world, there are only three printing lines with the ability to print a book in 24 hours at that level of cost. Now, the fourth printing operation will be in Moscow,” said the First Deputy Head of Moscow City’s Department of Science, Industrial Policy and Entrepreneurship Michael Ahn.
T8 was formed earlier this year as a result of a merger between the Ripol Classic publishing house and EE Media, a print-on-demand service provider. The company expects its turnover to reach 917 million rubles this year and exceed 2 billion rubles next year ($25 million and $55 million, respectively). It aims to occupy a leading position on the promising Russian print-on-demand market – capturing up to 12% of market share with an eightfold turnover increase in the next five years.
To achieve this, T8 intends to buy other publishers and integrate them into its modern publishing platform. “A strong company in a weak market – this is the ideal situation for the implementation of an M&A strategy, as the competition has practically no resources nor the time to fight,” the company believes.
T8 claims to own the largest directory of rights on books in Russia – up to 2 million books. The catalog includes rights on Russian books, the translation of foreign books into Russian, and the right to print original books in foreign languages.
Currently, T8 is attracting investments to implement its aggressive M&A strategy in exchange for a 25% stake in the company. Furthermore, it is planning an IPO on the Moscow Exchange for the end of this year (see the pre-IPO prospectus).
Among T8’s shareholders are Ripol Classic’s owner Sergey Makarenkov, Russian businessmen Evgeny Hata and Nicholas Lustiger, as well as former Mail.ru investor and chairman John Connor.
T8 is a resident of Technopolis Moscow, a territory in Moscow City dedicated to the development of high-tech industries. Thanks to this residency, the company is able to access a number of tax exemptions.
Sources: Moscow City Government, IR Guide, Kommersant, Rusbase
