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I sure hope the new owners treat there customers better than the last people did. I hope they help their excisting customer base to be successful as well. ... JB
 

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We were informed that Hirsch International has purchased a large equity stake in US Screen. This is a statement from Terry Combs, the US Screen Dealer Sales and Training Manager:

"Here is an update from inside USSPIT. Hirsch is now an equity partner in US Screen. We will operate as a separate company as we always have, and continue selling T-Jets, FastFilms, FastRIPs, etc. And yes, Scott is still CEO and President, and running the day to day operations. (And yes (again), he will be at the tradeshows just like he has been for the past 30 years.) The difference, you ask?? Deep inventory and faster machine delivery. Otherwise, we at US Screen are all still alive and well in Tempe, Arizona!"



Harry
 

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I attended one of screen printing class before of US Screen Printing and I would say it's all worth of every penny that I spent. Spending few days with them and chatting with them, you know the fact that this father and son duo company is all about 100% support and satisfaction, whatever decision they did, I strongly agree that it's all for the good of their customer. Knowing Hirsch as a giant manufacturing company and match this with Scott Fresener in the house, we should expect a way better service and equipment coming out soon from this.
 

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Discussion Starter · #6 ·
From a business standpoint, why would a successful company like Hircsh buy a company plagued with so many problems, and keep the same personal in place?
If you say to yourself, "Self", if the company is not having any issues, why sell?
I sense major changes, and they start at the top.
 

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I am curious as to whether Hirsch will be distributing the T-Jet from their 25 locations, and, if so, what happens to the dealer channel? Any feedback on this Harry? Also, what about the Hirsch relationship with their other direct to garment partners?
 

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From a business standpoint, why would a successful company like Hirsch buy a company plagued with so many problems, and keep the same personal in place?
If you say to yourself, "Self", if the company is not having any issues, why sell?
I sense major changes, and they start at the top.
In business point Hirsch did right call. Their main EMB business is very flat/decrease. They are making another legs (eggs in different basket. same as most EMB Co's Mesa SWF ---)with small investment (3mil payment to bank per month = $22485 x180 = few machine sale) maybe US screen was not in good stand to get this. Now there will be double dealers for them. It will be fun to watch. Competition is good. More and more machines will be in market by Oct'. Price will come down by depression and competition.
all are good news ~.
CHANGE :)
I survived 26 years in business with guessing what will happen next. I am surprise Sthal did not do it.
 

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I am curious as to whether Hirsch will be distributing the T-Jet from their 25 locations, and, if so, what happens to the dealer channel? Any feedback on this Harry? Also, what about the Hirsch relationship with their other direct to garment partners?

According to what I've been told, the existing US Screen dealer network will continue as before.

We are continuing to sell the entire Fast T-Jet printer line as well as provide service, parts, and inks for all the T-Jet's.

Harry
 

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I have a buddy who worked at the Colorspan Headquarters in Minnesota and when HP bought them they said nothing would change. But after speaking to him half the crew got tossed, those who stayed were evaluated carefully and paid accordingly (with some increases) and they dropped all lines except 2 printers (5400's and 9840's) and those still are't working right. After speaking to a few in the dealer arena for HP, the say that HP is trying to make good on getting everything ok for all existing Colorspan owners BUT never imagined how bad things actually were and kinda are having second thoughts. I believe Hirsh will under go same feeling.


Trust me there will be a shake.
 

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If anyone here looks at Hirsch's stock you can see that their company is not doing so well financially either. Hirsch currently distributes embroidery, screen printing equipment, and the Kornit DTG printers. Hirsch also recently partnered with Mimaki to distribute their (less expensive that the Kornit) DTG printers.

Here is the question: Why would Hirsch want the POS T-jet line of garbage when they already offer such a diverse range of DTG equipment?

Answer (This is a Theory/Opinion): They don't want the T-jet or care about the horribly designed machine at all. They want to tap into the customer base and reduce their competition in the market.

If US Screen had anything at all to offer Hirsch in the way of "technology" or a decent product, they would have sold out for much more than 3 million dollars.

3 million dollars is a small price for Hirsch to pay to eliminate competition from a promising market.

So, if anyone here thinks US Screen will be doing business as usual.... Think again.
 

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I predict this will be Harry's time to shine and he will if doesn't already got something in the works. I predict Hirsh will deal with Harry direct or He will release a machine.
 

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"3 million dollars is a small price for Hirsch to pay to eliminate competition from a promising market."



Super cheap.
 

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Looks like US Screen and Tjet has just been sold.
http://www.sec.gov/Archives/edgar/data/915909/000095013808000558/ex_10-1.htm

Im sure alot are curious about warrenties, support, parts, etc?

Funny how the "leading" dtg printer in sales has just sold for a measly 3mil.

Things that make you go hmm.
First off, according to the document you provided in the link, Hirsch has only purchased 80% of the outstanding equity interests of US Screen. What that means is they have bought 80% of the shares that US Screen issued and sold to other people. That does not include the other 20% of issued stock, or US Screen’s treasury stock, which we do not know how much they kept off the market. It is most likely that Hirsch now has a controlling interest of US Screen, but maybe not, and it is not an outright sale of the company in whole.

Also, I can’t see where the 3 million for a sale price comes in. According to the document, Hirsch bought the shares at $12.50 per share. For a 3 million total purchase that is only 240,000 shares. That does not seem right at all. 80% of the issued shares of a company that size and age should be in the tens of millions of shares. Say 80% of the issued shares were 20 million shares, that would put the purchase price at 25 million. Seems more realistic to me.

Anther point. Hirsch only bought what other people already owned any how. US Screen did not own that equity. It is possible this will not be a big change in the way US Screen operates other than now they have working capital, provided buy funding arrangements we don’t know the details to, to fund a plan for reaching a sustainable profitability and growth.

I also do not understand all the complaints against US Screen for service, support and supplies. I have had no problem getting people on the phone, getting answers or getting supplies for my T-Jet 2 since I bought it early this year. When I first got my T-Jet, I called them a lot and I always got prompt help, and I have had no problem buying ink (which I buy from Equipment Zone). US Screen may have been out of ink temporarily, but who cares when you can get it from five other places. Now if there was zero inventory in distribution, and no production to replenish inventory for distribution, that would be a problem. It is not a problem if the manufacturer has run out of inventory after adequately supplying its distribution network. That happens all the time. All that matters is that a manufacturer makes more product before the distribution network runs out.

I would say don’t panic if you own US Screen products, and don’t think this means necessarily US Screen was in serious trouble because this happened. Maybe they were in a pickle, maybe they were not. But this is normal stuff for corporate business. Corporations are not mom and pop businesses and they don’t approach capitalization and financing like a mom and pop business. Even if a business might have started out a mom and pop business, usually, if they incorporate, issue stock and grow like US Screen did, they change and learn the corporate way of business. We will just have to wait and see how things work out. But I can tell you, it would not be normal or a wise move by Hirsch to kill US Screen and strand US Screen’s customer base with out the resources to continue to produce product on their current machines. That would have negative ramifications from a marketing stand point and possibly a legal stand point.
 

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I too read the agreement and it was 80%, not a total sale. I think in the long run this can be a good thing for us screen as it will give them the capitol to move forward.
 

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Discussion Starter · #19 ·
Harry,
If tjets were no longer, how would that effect your business?
It seems so many rely on your expertise, help, and services that it would leave a big gap with existing customers.

3 million is not alot of working capital in a business of his size. I hope someone steps in and trys to right the ship per say. If they have as many customers as they say, then alot of people rely on service, parts, ink, etc.

If only someone could see into the future....
 

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I am not a lawyer (though I do play one on TV!) - but from what I read on the SEC filing, $3mil was the total exchange including the payment of all debt, at least $1.5mil of which was a loan from Chase Bank. I'm still a bit confused about the reasoning for the buyout as Hirsch just reported another quarter of losses. Some financial folks have told me that Hirsch "needed" the debt load as they were cash heavy - whatever that means.

The most interesting thing I see in the report is this:

"a duly executed “bad-boy” guaranty from Scott Fresener in the form set forth as Exhibit E;"

I would love to see that exhibit! Sounds like something my wife had me sign prior to our nuptuals!

I think we'll all get a pretty good idea of the ramifications of this by the time SGIA hits.
 
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