The biggest envelope manufacturer in the US, Cenveo, has hit troubled times.
Cenveo, now in Chapter 11, aims to restructure and come out alive, after listing with more than US$1.4bn in debts and about US$790m in assets. It now seeks $290m in loans in order to get back on its feet.
The company has made for 99 years, mainly used to carry America’s junk mail. In 2006 it began a major investment in rival envelope manufacturing acquisitions, buying 16 manufactures, including one for $430m. However with the GFC coinciding with the rise of the internet, snail mail began its rapid downward trajectory, leaving the company struggling to service its debt, which amounted to $121m a year, or $10m a month.
Cenveo shares have collapsed to around 10-12c, a far cry from the $7.50 in its heyday. Pundits say Ceveo’s acquisition spree sent it over the edge, not just the structural changes in the industry.