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Dive Brief: Paper Source named Elliott Investment Management as the successful bidder in a process for the specialty retailer to sell itself in Chapter 11. The deal includes $40 million in cash, plus additional cash for incremental financing taken on under Paper Source s debtor-in-possession facility, as well as assumed first-lien debt totaling $51.6 million, according to court papers. Elliott also owns Barnes & Noble, which the investment firm acquired in 2019, and the U.K.-based book chain Waterstones. Paper Source listed an affiliate of private equity and investment firm Apollo as a backup bidder. Dive Insight: Susan Lindstrom founded Paper Source in 1983 as a single store in Chicago to bring handcrafted paper goods from around the world to U.S. consumers. Lindstrom grew the retailer to 27 stores by 2007 before selling a majority stake to private equity firm Brentwood Associates, after which the retailer s expansion accelerated. ....
Staionary Retailer Paper Source Files For Bankruptcy, Plans Sale Jeremy Hill, Bloomberg News (Bloomberg) Paper Source Inc., the stationary and craft supplies chain, filed for bankruptcy with plans to sell itself after Covid-19 hampered expansion plans. The company intends to hand control of the business to an affiliate of MidCap Financial, a lending arm of Apollo Global Management, in exchange for debt forgiveness, court papers show. Paper Source owes about $103 million to lenders, including more than $55 million under a first-lien term loan. Paper Source, which has 158 stores across the U.S., expanded its reach last March when it bought about 30 stores from rival chain Papyrus out of bankruptcy. Less than three weeks later, Paper Source temporarily shut down all of its own stores, which generated more than 80% of sales in 2019. ....