UPM Raflatac announces further progress towards Ellen MacArthur Foundation’s New Plastics Economy Global Commitment

Supremex Inc. announced the acquisition of substantially all of the assets of Royal Envelope Corporation (“Royal”), an envelope manufacturer and lithography company located in Chicago. This transaction was concluded for a total cash consideration of US$18.7 million on a cash-free and debt-free basis plus US$2.0 million for manufacturing equipment that was recently commissioned. “We are very excited with this acquisition that expands our reach in the fragmented U.S. envelope market and gives us a significant manufacturing presence in the U.S. Midwest,” said Stewart Emerson, President and CEO of Supremex. “Royal has established itself as one of the preeminent direct mail envelope manufacturers in North America, utilizing a modern fleet of envelope converting equipment, in-house lithographic printing and embellishing, targeting the financial services sector. We expect this acquisition will generate significant synergies and additional operating efficiencies throughout our network. We are pleased that John, Matt and Mike Pusatera will remain with the Supremex team.”

Companies and organizations continue to promote the switch from print to digital forms of communication but is this cost-cutting in the best interests of the customer? Based on a June 2017 U.S. survey¹, 90% of respondents felt they should have the right to choose how they receive communications (printed or electronic) from financial organizations and service providers, and 83% thought consumers should not be charged more for choosing a paper bill or statement. However, corporations are increasingly charging their customers for paper statements.

Supremex Inc. announced a plan to further optimize its Canadian envelope operations by reducing expenses and improving resource allocation. Supremex will be closing its Edmonton facility and reducing its Canadian envelope facility headcount by a total of 39 employees, or approximately 5% of its total workforce. These measures will result in annual cost reductions of approximately $2.4 million, before taxes, which will begin to materialize in the current quarter and throughout the first three quarters of 2021 as operations wind down in Edmonton. A one-time charge of approximately $2.5 million, before taxes, will be recorded in the Company’s 2020 fourth quarter results.