As Australian Paper tries to force through a new wages policy for its envelope plant the biggest envelope manufacturer in the US, Cenveo, has just declared bankruptcy.

Cenveo is now in Chapter 11, aiming to restructure and come out alive, after listing with more than US$1.4bn in debts and about US$790m in assets. It is currently seeking $290m in loans in order to get back on its feet.

The company has been making envelopes for the past 99 years, mainly used to carry America’s junk mail.

In 2006 it began a major investment in rival envelope manufacturing acquisitions, buying 16 manufactures, including one for $430m. However with the GFC coinciding with the rise of the internet, snail mail began its rapid downward trajectory, leaving the company struggling to service its debt, which amounted to $121m a year, or $10m a month.

[Related: Australian Paper fails to settle strike]

Cenveo shares have collapsed to around 10-12c, a far cry from the $7.50 in its heyday.

The envelope business is undergoing struggles in Australia, as electronic communications take a larger slice of the pie, and with Australia Post appearing indifferent at best to mail during the reign of former CEO Ahmed Fahour.

Australian Paper is currently aiming to reduce its overall wage bill at its Preston site, which manufactures some two billion envelopes a year, while the country’s number two manufacturer Candida closed its Sydney plant late last year to consolidate into Adelaide.

However commentators believe it was the acquisition  spree that sent Cenveo over the edge, not just the structural changes in the industry.

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