National Envelope Files Second Bankruptcy in Three Years
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National Envelope, Frisco, Texas, the largest private U.S. envelope maker, sought bankruptcy protection for the second time in three years this week as cost cuts failed to keep pace with the decline in mail usage. According to a Reuters news report, the company blamed its struggles in part on its supply agreement with International Paper Co., which prevented it from reducing costs as sharply as its competitors. The company makes 37 billion envelopes a year and employs 1,600 people.
NE Opco Inc., which does business as National Envelope, said in court documents it had retained PricewaterhouseCoopers to help it find a buyer of its assets. So far, 18 potential buyers have signed non-disclosure agreements and it expects a "spirited" bidding process.
Money from the sale of National Envelope's assets would go to repaying its debts, which include $148.3 million in secured debt and about $20 million in trade debt, according to documents filed this week with the U.S. Bankruptcy Court in Wilmington, Del.
National Envelope filed for bankruptcy in 2010 and was sold to an affiliate of the Gores Group private equity firm for $150 million along with the assumption of debt.
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