A British private equity firm is making another U.S. acquisition.
Elliott Investment Management has entered into a definitive agreement to acquire the assets and business operations of Paper Source Inc. The stationery and gift retailer filed for bankruptcy in March, with a plan to sell itself. The acquisition will allow Paper Source to emerge from Chapter 11 with the support of a well-capitalized owner committed to the development and growth of the business, according to a statement by Elliott.
Following the Chapter 11 process, Paper Source will benefit from significantly less debt on its balance sheet. It will operate approximately 130 stores (down from 158 at the time of the filing) across the United States as well as its wholesale division, Waste Not Paper by Paper Source.
Elliott is also the owner of Barnes & Noble, which it acquired in September 2019. While Paper Source and Barnes & Noble businesses will continue to operate independently, the businesses are highly complementary and considerable opportunities exist for mutually beneficial retail partnerships, according to Elliott. James Daunt, CEO of Barnes & Noble, will have oversight responsibilities for both companies.
“I look forward to working closely with everyone at Paper Source,” Daunt stated. “This is a wonderful brand, with a unique culture and community. With Paper Source’s management team, we will support and accelerate the brand’s strategic growth initiatives. Alongside this, the opportunities for Paper Source to work with Barnes & Noble are tremendously exciting for both businesses.”
Added Paul Best, portfolio manager and head of European private equity at Elliott said: “As the country’s leading specialty retailer of stationery, cards and gifts, we see tremendous future potential in Paper Source’s business. We look forward to working closely with the management team to position the brand for continued growth coming out of the pandemic.”