As first reported in a Breaking News Alert this morning, Top 40 distributor Standard Register (asi/333647) has filed for Chapter 11 bankruptcy-court protection. As part of the filing, the company also signed a deal with an affiliate of equity firm Silver Point Capital to be acquired for $275 million. Silver Point Capital is a private investment firm that manages approximately $8.5 billion in holdings.
In its filing, Standard Register blamed declines in the traditional print market for the financial pressure that pushed it into bankruptcy. The Dayton, OH-based company also claimed that its debts include nearly $184 million worth of loans that it needed to complete the 2013 acquisition of former Top 40 distributor WorkflowOne.
"The company believes that this sale will right-size the business’ balance sheet by significantly reducing its outstanding indebtedness and other liabilities to better position the business for long-term growth and profitability in the hands of a capable buyer," the company said in a statement along with its Chapter 11 filing in U.S. Bankruptcy Court in Wilmington, DE.
Joseph Morgan Jr., Standard Register’s president and CEO, said the plan to enter Chapter 11 and sell the company would ultimately help its operations moving forward. “The board and management team have conducted a rigorous assessment of all of our strategic options and believe that this process represents the best possible solution for Standard Register,” Morgan said in a statement this morning. “We have sufficient financing to fund our operations as we complete a process that should result in greater flexibility for investment in the future.”
Last week, after the company was delisted from the New York Stock Exchange, Standard Register told Counselor that its promotional business is thriving. “We’re focused right now and into the future on building our ad specialty business, which is performing well,” said Jeff Moder, Standard Register’s recently-named president of promotional marketing. “We’re excited for what’s ahead.”
Standard Register recently reported to Counselor that its 2014 North American ad specialty sales were $118.8 million, a year-over-year increase of about 6%.