Verso to be purchased by leading European packaging company
Plans for large Wisconsin Rapids mill are not clear
MADISON, Wis. – Verso Corporation has announced the acquisition of the company by a leading European sustainable packaging company for $825 million. BillerudKorsnäs said it will continue operations in Quinnesec, Mich., and convert the Escanaba, Mich., mill while maintaining operations there. It did not comment regarding its plans for the large, shuttered Wisconsin Rapids pulp and paper mill.
Negotiations between Verso and BillerudKorsnäs took place after Atlas Holdings, a Connecticut private equity group, offered $20 per share for Verso. The BillerudKorsnäs deal yields a 35% increase over the Atlas offer for Verso shareholders.
BillerudKorsnäs said it plans to convert Verso’s Escanaba mill into “a world-class, sustainable, fully integrated paperboard production site.” One machine is estimated to be converted by 2025. A second machine will be converted by 2029, bringing total capacity to around 1,200,000 tons. BillerudKorsnäs estimates that the investment for the conversion project will be up to approximately $1 billion.
In addition to continued paper production in Escanaba during the conversion, BillerudKorsnäs plans to continue operating the Quinnesec mill, calling it “a cost and quality leader in graphic paper, specifically in coated freesheet and specialty papers.” The Quinnesec mill has the capacity to produce about 430,000 tons.
In announcing the Verso sale, the Ohio company said: “In making this acquisition, BillerudKorsnäs recognizes that Verso's strategic assets are positioned in a region with abundant and cost-effective fiber supply suitable for production of premium packaging materials. Verso's location also presents favorable export opportunities to both Asia and Europe. Verso will become the platform for BillerudKorsnäs' future expansion in North America and is expected to provide continuous growth opportunities over the next ten years and beyond. The combined company will be one of the largest providers of virgin fiber paper and packaging with a cost and quality advantage.”
The Verso transaction represents BillerudKorsnäs’ first move into North America. Its current operations are in Sweden, Finland and the United Kingdom
The Verso purchase is expected to close in the second quarter of 2022.