In a corporate drama worthy of Wall Street lore, Royal Interco LLC, the Arizona-based private label paper products supplier to grocery giants like Trader Joe’s, Whole Foods, Kroger, and Aldi, has filed for Chapter 11 bankruptcy protection in Delaware. The move comes as the company reels from a perfect storm of $205 million in outstanding secured debt, supply chain disasters, and financial chaos.
In a first-day declaration filed late Tuesday, Chief Restructuring Officer Michael Ragano detailed how the company unraveled under the crushing weight of labor shortages, a devastating fire at one of its distribution centers, and a tightening credit leash from wary suppliers ahead of a looming debt maturity.
A Chain Reaction of Catastrophe
“The dominoes began to fall,” Ragano wrote, pointing to the decline in supplier credit that halted the company’s ability to purchase essential raw materials—most critically, pulp. Without it, fulfilling orders on time and in full became a near-impossible mission.
That ripple effect pushed Royal Interco to the brink, forcing its hand toward Chapter 11 reorganization.
