Deluxe deal falls through

Sep 01, 1998 9:30 PM  By

Deluxe Corp. has terminated its agreement to sell its catalog holdings-specialty paper catalog PaperDirect and consumer greeting card and gift wrap catalog Current Social Expressions-to an undisclosed investor.

Citing the investor’s inability to meet financing conditions, $1.9 billion Deluxe announced in July that it was still looking for potential buyers for its mail order properties. Deluxe wants to focus exclusively on its financial services and check-printing businesses. The Shoreview, MN-based company will continue operating the catalogs in the meantime, according to a statement.

In May, Deluxe thought it had successfully found a buyer, ending nearly two years of trying to unload the two underperforming holdings. Paper Direct and Current produced combined sales of $231 million in 1997 but lost $4.2 million, mostly due to PaperDirect.

“Our interest is in divesting these properties because they are not strategic to Deluxe’s growth strategy,” says Deluxe spokesman Stuart Alexander. “But we are not going to give them away, either.” Alexander adds the investor might still be able to complete the purchase. But for now, he says, Deluxe is exploring other suitors. Although Alexander would not comment on the investor’s identity, several industry professionals believe it to be Dallas-based Empire Financial Corp., which last year had tried to acquire auto parts supplier Dana Corp.