RE:Will SXP go private this year?Interesting notion. My first thought: are buyers really going to want envelopes long term?
But it turns out there has been lots of buyout activity in this space. Much on this (plus some Supremex history) in the following from August 2022 Printing Impressions.
https://www.piworld.com/article/cenveo-returns-roots-envelope-printing-converting/ Two interesting passages. First, I had no idea Supremex and Cenveo used to be under the same roof.
"The low margin envelope business [of Cenveo predecessor] was spun out of Georgia-Pacific in 1993 as the Mail-Well company, with 16 manufacturing plants (remember this number) that produced about 13 billion envelopes annually. Leverage was high, with $17 million in equity supporting $142 million of debt, another trend that would continue. Acquisitions were on the table from jump, including the 1994 purchase of American Envelope Company and the addition of Canadian envelope manufacturing Supremex in 1995 (subsequently one of the first spin-offs under Cenveo in 2005). In 1995 the company went public once again, decreasing leverage, although not for long. Margins remained tight, with reported net income of $8 million on sales of $597 million (1.34%)." And later this.
"A new envelope manufacturing platform company with private equity backing was announced in July [2022]. CenterGate Capital, based in Austin, Texas, purchased United Envelope. The acquired company is based in Ridgefield, New Jersey and has additional manufacturing locations in Pennsylvania and Ohio. CenterGate is seeking add-ons in the envelope segment. However, not content to keep its focus strictly on envelopes, CenterGate also states that it will consider add-ons in flexible packaging, folding cartons, paper-based products, and other graphic arts services." ========
So, yeah, not out of the question that Supremex would be of interest to buyers, private equity or otherwise, looking for solid cash flow.