Verso gives up on reopening Duluth paper mill
Company is trying to sell the mill
MADISON, Wis. -- Verso Corporation announced that it has decided not to reopen its Duluth paper mill in a decision made by the company’s board of directors on Jan. 22. The Verso mill had been experimenting with converting the mill to kraft paper by running that product on one line at the mill. The mill was idled in July, 2020 other than limited production on that line and maintenance needed to keep the mill in a position to be sold or reopened.
Verso said the decision was “made in response to the continued accelerated decline in printing and writing paper demand resulting from the COVID-19 pandemic”.
Allen J. Campbell, Verso’s chief financial officer, said that the company will continue efforts to sell the mill. In a statement filed with the U.S. Securities and Exchange Commission, the mill was listed at a book value of $75 million. Campbell said that Verso will write off $65-70 million related to the mill closure in its 2020 financial statements.
He said that due to the decision to not restart the Duluth mill, Verso expects to recognize approximately “$5 million to $10 million in certain contract termination and other associated charges” as of December 31, 2020.
Verso said that it would reduce employment at the mill by a further 15 to 20 people. About 220 people were furloughed when the mill closed in July, 2020.