The days of having the broadest possible portfolios are over. At least at Electronics for Imaging (EFI). After the company had already separated from its software division more than a year ago, it was announced last week that the Fiery business will also be spun off into a separate company effective immediately. EFI itself intends to focus exclusively on its industrial inkjet business in the future.
Digital front ends (DFE) have been the cornerstone and core business of EFI for many decades. As an OEM partner, EFI has developed print servers that work with virtually all digital presses and in a variety of different markets, from packaging and commercial to other industrial applications. With its Fiery Print Servers, EFI has even become a kind of industry standard in terms of print data preparation and RIP technology, even though the large number of press manufacturers have long since developed and offered their own digital front ends. Just last July, EFI acquired CADLink Technology, a Canadian provider of production and workflow software, and integrated it into its Fiery business.
Following the sale of its production software division to Symphony Technology Group (STG) in early January 2022, it had been rumored that EFI would focus on its inkjet printing and Fiery businesses going forward. With the latest news about the spin-off of the Fiery business, EFI’s field of activity is now “shrinking” significantly once again – and of all things, around the area that was originally the core business of Electronics for Imaging. But first things first. What is this news all about and what does it mean for those who use Fiery products?
Fiery to operate as an independent company in the future
Coinciding with the “Connect” user conference in Las Vegas, which was held for the first time this year under the leadership of eProductivity Software (EPS), the news was announced. The Fiery business will be spun off from the EFI group structure and will operate in the future as an independent company called “Fiery” – and as a wholly owned subsidiary of Siris Capital Group LLC, which had acquired the overall EFI group in 2019.
As far as the organizational structure of the spun-off company is concerned, not too much is expected to change, according to initial information: Fiery will continue to be headed by Toby Weiss, who has already served as Chief Operation Officer and General Manager of the business unit in recent years and is now CEO of Fiery. At EFI itself, the previous CEO, Jeff Jacobson, is stepping down into “the second row” and handing over responsibility as CEO to Frank Pennisi. Jacobson, however, remains Executive Chairman – and takes on that role at Fiery as well.
“With this realignment, Fiery is well positioned to accelerate investments and win in its current markets while strategically expanding its presence in key adjacent markets – as evidenced by Fiery’s recent acquisition of CADlink Technology Corporation,” according to a company release quoting Jacobson. At the same time, the goal is to operate more independently in the marketplace in the future. Even if the businesses had already worked independently of each other before, the now official separation makes this independence even more clear.
In an interview with David Zwang from Whattheythink, Jeff Jacobson also explains the background to the change in strategy described above. A few years ago, the order of the day was “synergy”. “For many years, we believed that one plus one equaled three – and that offering total packages was the right thing to do,” Jacobson says. “In the meantime, however, we know that it’s all about focus and specialization in order to actually leverage the potential of the individual technologies.”
EFI becomes a “pure player” in industrial inkjet
In the future, EFI will focus exclusively on its industrial inkjet business – after all, Jacobson said, the potential here is huge. “Especially in the packaging and textile sectors. Here, digital printing technologies still account for less than 10 percent, according to the Executive Chairman. Therefore, in the future, EFI will deliberately focus on the expansion of inkjet technologies in the industrial environment, and – according to Jacobson – put more into M&A and investments.
EFI’s involvement in industrial inkjet dates back to 2005, when the company acquired superlarge format specialist Vutek. It was followed by Jetrion, Raster Printers, Cretaprint and later Reggiani, as well as suppliers from the ink, or rather, ink manufacturer sector.
Frank Pennisi, EFI’s new CEO, comes from a wide-format printing background himself and was himself a user of EFI’s Nozomi and Vutek wide-format printers for many years as part of the U.S. companies Orora Packaging Solutions and Orora Visual. He also brings experience in management positions from his professional positions at Flir Systems, Honeywell and GE.
Shrinkage, or: After generalization follows specialization
EFI has already set a turning point in the direction of its business activities with its decision in early 2022 to sell its production software division: Moving away from being a generalist that could supply everything from software to data preparation to machines as an “all-round carefree package” from a single source, to becoming a more specialized provider. This is becoming even more obvious now with the latest news about the spin-off of the Fiery business.
In the future, the EFI brand will stand for Industrial Inkjet, exclusively. Of course, this is a strange feeling at first, because it is unfamiliar – but the step is quite understandable: After all, after the American group successively became a machine manufacturer as well – and thus entered into competition with its OEM customers from the DFE business – the separation of the two business sectors could actually ensure more neutrality. It could give the OEM business with the Fiery Digital Frontends a push. And EFI itself will be a Fiery customer in the future.
However, another fact could weigh more heavily: After all, with the spin-off of the Fiery division, EFI is saying goodbye to its actual cornerstone.