(Reuters) - National Envelope, the largest private U.S. envelope maker, sought bankruptcy protection for the second time in three years Monday as cost cuts failed to keep pace with the decline in mail usage.
The Frisco, Texas, company blamed its struggles in part on its supply agreement with International Paper Co
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 had signed non-disclosure agreements and it expects a "spirited" bidding process.
Agreed sales in bankruptcy are generally subject to higher bids and court approval.
The 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 on Monday with the U.S. Bankruptcy Court in Wilmington, Delaware.
To fund its operations during its bankruptcy, National Envelope had secured a $67.5 million loan from Salus Capital Partners, according to court documents.
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.
(Reporting by Tom Hals in Wilmington, Delaware; Editing by Marguerita Choy)