Pitney Bowes has sold a controlling interest in its struggling Global Ecommerce (GEC) unit after a months-long board review of the business’ future.

Now in the hands of liquidator Hilco Global, entities “representing a substantial majority” of GEC will be put under the Chapter 11 bankruptcy protection process until it winds down. Under Hilco, GEC has been renamed DRF Logistics, which will operate briefly to enable customers to transition to other providers.

More from Sourcing Journal

• Eastern Mountain Sports Secures $5 Million Stalking Horse Bid

• GXO's Volume Trends Show Positive Signal for Freight Market

• Air Cargo Shows Strong First Half, With Q4 Peak in Sight

Facilities will accept customers’ domestic standard delivery and domestic cross-border U.S. outbound packages until 12 p.m. local time on Aug. 17. All packages presented at those facilities after the fact will be turned away. DRF will not accept returns parcels in its pickup and drop-off network after Aug. 9, but will pick up returns from the U.S. Postal Service (USPS) network through Sept. 5.

Pitney expects the sale to eliminate “substantially all of the losses” associated with GEC, wiping out approximately $136 million in losses for the year ended Dec. 31, 2023.

On top of the anticipated savings from the GEC segment divestment, the logistics provider currently has a companywide cost-savings target between $120 million and $160 million. Much of that is expected to be realized in 2024.

“When the company announced our four strategic priorities in late May, we committed to working with speed and urgency to complete a comprehensive review of alternatives for GEC,” said Lance Rosenzweig, interim CEO of Pitney Bowes, in a statement. “We are pleased to have delivered on that commitment by concluding a productive review and identifying an exit path for GEC that provides for an orderly and efficient wind-down of the business, which will ultimately maximize value for Pitney Bowes shareholders.”

The writing on the wall became apparent in early July, when the company announced GEC unit president Gregg Zegras retired from the role, with no replacement named.

GEC, which provides business-to-consumer logistics services for domestic and cross-border parcel delivery, returns and fulfillment for companies Abercrombie & Fitch, like Shein and Victoria’s Secret, was the center of a proxy fight brought on by hedge fund Hestia Capital last year due to the unit’s declining earnings since 2015. At the time, Hestia said GEC was holding back the company’s other areas of the business and sought to replace then-CEO Marc Lautenbach.