Verso slows efforts to sell mill to new buyers
Verso CEO resigns shortly after paper mill closure
MADISON, Wis. -- A Verso Corporation executive involved in planning the future of the shuttered Wisconsin Rapids paper mill said that the company is slowing its efforts to sell the mill.
David Sams, Verso's vice president of environmental health, safety and sustainability, told members of the Wisconsin Rapids Together Task Force Wednesday morning that a sale in the near future will be “impossible,” according to a story in the Wisconsin Rapids Tribune.
Sams told the task force that the current economic situation and the ongoing pandemic have made it difficult to find a buyer, and potential buyers have been reluctant to travel to tour the mill due to the pandemic.
The mill employed nearly 900 people prior to the June announcement of its closing. There will be about 60 people employed through year end to maintain the mill as winter sets in.
State Rep. Scott Krug (R-Nekoosa) suggested that the task force had identified two possible buyers including Phoenix Paper, a Chinese company that purchased a shuttered Verso mill in Illinois.
“(Verso has) proved to our workforce, our community, everybody that they’re simply out for themselves at this point,” Krug said, according to the Tribune story.
The news follows recent news of the resignation of the company's CEO. Adam St. John resigned as of Sept. 30, three months after the announced closure of the massive mill.
The company’s board of directors named Randy Nebel, a member of the company’s board, as interim CEO. Nebel is a former executive of KapStone Paper and Packing and of Longview Fibre Paper and Packing, Inc.
With the onset of Covid 19, Verso’s sales had dropped by 55 percent in the second quarter from the same period in the previous year and the company lost $34 million. However, it is debt free and declared a $3 per share special dividend and initiated a regular quarterly dividend of $.10 per share.
Meanwhile, the Duluth News Tribune reported that Verso had initiated in January a project at the Duluth mill (which was also closed this summer) to initiate conversion of some production at that mill from graphic and printing paper to packaging. The project involved a $6 million capital investment. A scheduled second investment has not been made, the News Tribune reported.
Demand for packaging paper has been growing as retail business moves toward direct to consumers.
Meanwhile, U.S. Sen. Tammy Baldwin (D - Wisconsin) urged Verso to sell the mill to a buyer showing a commitment to its workers and the Wisconsin Rapids community. She urged the company to select new owners that are “committed to north central Wisconsin’s future”. The mill has gone through several ownership changes since its sale by the Mead family 20 years ago.