The Paper Store is the latest retailer to file for Chapter 11 bankruptcy protection blaming the COVID-19 pandemic.
The Massachusetts-based specialty retailer, which operates a warehouse and 86 stationery and gift stores throughout the Northeast along with an e-commerce business, plans to look for a buyer while in bankruptcy.
In court papers, Don Van der Wiel, a restructuring adviser to The Paper Store, stated that the company has been operating under “considerable strain” caused by the pandemic, which has had a severe impact on revenues. A group that includes one of the The Paper Store’s creditors has "expressed an interest" in making a stalking horse bid for the company that would set the baseline at an auction, according to the documents.
The Paper Store entered bankruptcy with $45 million in funded debt, $13.5 million in unpaid bills to vendors, and $3.7 million in unpaid rent for April, May and June, among other liabilities.