MIAMISBURG, Ohio, Dec. 19, 2021 /PRNewswire/ -- Verso Corporation
(NYSE: VRS) ("Verso") today announced that it has entered into a
definitive merger agreement under which BillerudKorsnäs AB
("BillerudKorsnäs") will acquire all of the outstanding shares of
Verso for a purchase price of $27 per
share in cash, or approximately $825
million1. Verso's Board of Directors, acting upon
the recommendation of a special committee of Verso's Board, has
unanimously approved and resolved to recommend approval of the
merger by Verso's shareholders. The transaction is expected to
close in the second quarter of 2022.
The consideration corresponds to a premium of
approximately 35% compared to closing price of Verso's shares
on December 17, 2021; a premium of
approximately 26% compared to Verso's volume-weighted average share
price during the last 30 trading days; and a premium of
approximately 57% compared to the unaffected closing price of
Verso's shares on July 9, 2021, the
day prior to Atlas Holdings' submission of an unsolicited,
non-binding proposal to acquire Verso for $20.00 per share in cash.
The acquisition of Verso is fully in line with BillerudKorsnäs'
strategy to drive profitable growth in paperboard, and the ambition
to expand into North America.
BillerudKorsnäs aims to build one of the most cost-efficient and
sustainable paperboard platforms in North
America by converting several of Verso's assets into
paperboard machines while maintaining Verso's position as a quality
and cost leader in specialty and coated freesheet paper.
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.
Randy Nebel, President and Chief
Executive Officer of Verso, said, "With the support of our talented
team, Verso has successfully streamlined our operations and reduced
costs while strategically investing in projects to enhance our
ability to support our customers. This transaction builds upon our
considerable progress and better positions the combined company to
invest in our North American manufacturing capability, provide
high-quality paper products to customers and accelerate
growth."
Mr. Nebel continued, "This agreement follows careful
consideration and negotiation led by the special committee of our
Board which was formed following receipt of the unsolicited
proposal earlier this year. Our full Board believes this
transaction maximizes value for shareholders, who will receive a
significant premium and immediate and certain value. In
BillerudKorsnäs, we found a partner that shares our commitments to
safety, quality, sustainability and innovation and is uniquely
positioned to recognize the value of our business. We are grateful
for BillerudKorsnäs' partnership over the past several months in
reaching this compelling transaction, particularly amidst an
uncertain and restrictive pandemic-related travel environment. We
are excited to join forces with BillerudKorsnäs and benefit from
enhanced opportunities as part of a larger, stronger
organization."
Christoph Michalski, President
and CEO of BillerudKorsnäs, commented, "The combination of
BillerudKorsnäs' expertise in high-quality virgin fiber packaging
materials and Verso's attractive assets creates an excellent
platform for long-term profitable growth. We will obtain
cost-effective production of coated virgin fiber material in the
Midwestern United States. We also plan to sequentially transform
part of the business into paperboard production while continuing to
serve the U.S. customers. Our investments will create new
U.S.-based jobs in a growing market and accelerate the transition
from plastic-based packaging materials to renewable sources."
Investing in Verso's Platform
BillerudKorsnäs plans to
convert Verso's largest facility, its Escanaba Mill, into a
world-class, sustainable, fully integrated paperboard production
site. One machine is estimated to be converted by 2025, a
second machine by 2029, with a total capacity of around 1,200,000
tons (1,100 ktonnes). BillerudKorsnäs estimates that the investment
for the conversion project will be up to approximately $1 billion2.
In addition to continued paper production in Escanaba during the
conversion, BillerudKorsnäs plans to continue operating the
Quinnesec Mill, a cost and quality leader in graphic paper,
specifically in coated freesheet and specialty papers. The mill has
the capacity to produce about 430,000 tons (400 ktonnes) of graphic
and specialty papers and 240,000 tons (200 ktonnes) of market pulp
per year.
BillerudKorsnäs is committed to continuing to serve Verso's
existing customers.
Additional Transaction Details
The acquisition will be
effected pursuant to a definitive merger agreement under which
Verso will merge with a wholly-owned subsidiary of BillerudKorsnäs.
The acquisition will be primarily financed by BillerudKorsnäs
through increased debt and operating cash flow. Closing of the
transaction is not subject to any financing condition.
A special meeting of Verso's shareholders is expected to be
convened following the mailing to Verso's shareholders of a proxy
statement for the transaction. The transaction is expected to close
during the second quarter of 2022, subject to the approval of
Verso's shareholders, as well as receipt of regulatory approvals
and satisfaction of other customary closing conditions. Regulatory
approvals include U.S. antitrust approval as well as approval from
relevant state and federal energy regulatory authorities in the
U.S.
Advisors
Rothschild & Co serves as exclusive
financial advisor and Kirkland & Ellis LLP serves as legal
counsel to Verso. BofA Securities serves as exclusive financial
advisor, Skadden, Arps, Slate, Meagher & Flom LLP serves as
U.S. legal counsel and Cederquist serves as Swedish legal counsel
to BillerudKorsnäs.
About Verso Corporation
Verso Corporation is a leading
American owned and operated producer of graphic, specialty and
packaging paper and market pulp, with a long-standing reputation
for quality and reliability. Verso's graphic paper products are
designed primarily for commercial printing, advertising and
marketing applications, including direct mail, catalogs, corporate
collateral, books and magazines. Verso's specialty paper products
include release liner papers and label face stock for pressure
sensitive, glue-applied and laminate applications. Verso produces
packaging paper used in higher-end packaging and printing
applications such as greeting cards, book covers, folders, labels
and point-of-purchase displays. Verso also makes market pulp used
in printing, writing, specialty and packaging papers, facial and
toilet tissue, and paper towels. For more information, visit us
online at versoco.com.
About BillerudKorsnäs
BillerudKorsnäs provides
packaging materials and solutions that challenge conventional
packaging for a sustainable future. We are a world leading provider
of primary fiber based packaging materials and have customers in
over 100 countries. The company has seven production units in
Sweden and Finland, and about 4,400 employees in over 13
countries. BillerudKorsnäs has an annual turnover of approximately
SEK 24 billion and is listed on
Nasdaq Stockholm. www.billerudkorsnas.com.
Forward Looking Statements
This release contains
"forward-looking statements" regarding Verso,
BillerudKorsnäs or their respective management's future
expectations, beliefs, intentions, goals, strategies, plans and
prospects, which, in the case of Verso, are made in reliance on the
"safe harbor" provisions within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements involve substantial risks, known and unknown,
uncertainties, assumptions and other factors that may cause actual
results, performance or achievements to differ materially from
future results expressed or implied by such forward-looking
statements including, but not limited to, the occurrence of any
event, change or other circumstances that could give rise to the
right of one or both of Verso or BillerudKorsnäs to terminate
the merger agreement; the ability to obtain regulatory approvals
and/or meet other closing conditions to the proposed merger on a
timely basis or at all; the ability to obtain approval by Verso
stockholders; difficulties and delays in integrating Verso's and
BillerudKorsnäs' businesses; risks that the proposed merger
disrupts Verso or BillerudKorsnäs current plans and
operations; failing to realize anticipated synergies, cost savings
and other anticipated benefits of the proposed merger when expected
or at all; potential adverse reactions or changes to business
relationships resulting from the announcement or completion of the
proposed merger; the risk that unexpected costs will be incurred;
uncertainties as to BillerudKorsnäs' ability to obtain
financing in order to consummate the merger; the ability of Verso
or BillerudKorsnäs to retain and hire key personnel; the
diversion of management's attention from ongoing business
operations; uncertainty as to the price of Verso common stock; the
outcome of any legal proceedings that may be instituted against
Verso, BillerudKorsnäs or their respective directors and
officers; changes in global, political, economic, business,
competitive, market and regulatory forces; changes in laws and
regulations or the interpretation or enforcement thereof; changes
in rates and policies; future business acquisitions or disposals;
competitive developments; and the timing and occurrence (or
non-occurrence) of other events or circumstances that may be beyond
Verso's and BillerudKorsnäs' control. These and other risks,
uncertainties, assumptions and other factors may be amplified or
made more uncertain by the COVID-19 pandemic, which has caused
significant economic uncertainty. The extent to which the COVID-19
pandemic impacts Verso's and BillerudKorsnäs' businesses,
operations and financial results, including (without limitation)
the duration and magnitude of such effects, will depend on numerous
factors, which are unpredictable, including, but not limited to,
the duration and spread of the outbreak, its severity, the actions
taken to contain the virus or treat its impact, and how quickly and
to what extent normal economic and operating conditions can resume.
Forward-looking statements generally relate to future events or
Verso's and BillerudKorsnäs' future financial or operating
performance and include, without limitation, statements relating to
the proposed merger and the potential impact of the COVID-19
outbreak on Verso's and BillerudKorsnäs' businesses and operations.
In some cases, you can identify forward-looking statements because
they contain words such as "anticipates," "believes,"
"contemplates," "could," "seeks," "estimates," "intends,"
"targets", "expects", "allows", "enables", "may," "plans,"
"potential," "predicts," "projects," "should," "will," "would" or
similar expressions and the negatives of those terms.
While forward-looking statements are Verso's and
BillerudKorsnäs' current predictions at the time they are
made, you should not rely upon them. Forward-looking statements
represent Verso's and BillerudKorsnäs' management's beliefs
and assumptions only as of the date of this release, unless
otherwise indicated, and there is no implication that the
information contained in this release is made subsequent to such
date. For additional information concerning factors that could
cause actual results and outcomes to differ materially from those
expressed or implied in the forward-looking statements, please
refer to the cautionary statements and risk factors included in
Verso's filings with the SEC, including Verso's Annual Report on
Form 10-K filed with the SEC on March 1,
2021, Verso's Quarterly Reports on Form 10-Q and any further
disclosures Verso makes in Current Reports on Form 8-K. Verso's SEC
filings are available electronically on Verso's investor website at
https://investor.versoco.com/ or the SEC's website at
www.sec.gov.
For additional information concerning factors that could cause
future results to differ from those expressed or implied in the
forward-looking statements, please refer to
BillerudKorsnäs' non-exhaustive list of key risks and
cautionary statements included in BillerudKorsnäs' Annual
Report, which is available electronically on
www.billerudkorsnas.com/investors. Except as required by law, Verso
and BillerudKorsnäs assume no obligation to update these
forward-looking statements or this release, or to update,
supplement or correct the information set forth in this release or
the reasons actual results could differ materially from those
anticipated in the forward-looking statements, even if new
information becomes available in the future. All subsequent written
and oral forward-looking statements attributable to Verso or
BillerudKorsnäs or any person acting on behalf of either party are
expressly qualified in their entirety by the cautionary statements
referenced above.
All subsequent written and oral forward-looking statements
attributable to Verso, BillerudKorsnäs or any person acting on
behalf of either party are expressly qualified in their entirety by
the cautionary statements referenced above.
Additional Information and Where to Find It
In connection with the proposed merger, Verso expects to file
with the SEC and furnish to its stockholders a proxy statement on
Schedule 14A, as well as other relevant documents regarding the
proposed merger. Promptly after filing its definitive proxy
statement with the SEC, Verso will mail its definitive proxy
statement and a proxy card to Verso's stockholders entitled to vote
at a special meeting relating to the proposed merger, seeking their
approval of the respective merger-related proposals. The proxy
statement will contain important information about the proposed
merger and related matters. STOCKHOLDERS AND SECURITY HOLDERS OF
VERSO ARE URGED TO READ THESE MATERIALS (INCLUDING ANY AMENDMENTS
OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS IN
CONNECTION WITH THE MERGER THAT VERSO WILL FILE WITH THE SEC WHEN
THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT VERSO, THE MERGER AND THE OTHER TRANSACTIONS
CONTEMPLATED BY THE MERGER AGREEMENT THAT HOLDERS OF VERSO'S
SECURITIES SHOULD CONSIDER BEFORE MAKING ANY DECISION REGARDING
VOTING. This release is not a substitute for the proxy statement or
for any other document that Verso may file with the SEC and send to
its stockholders in connection with the proposed merger. The
proposed merger will be submitted to Verso's stockholders for their
consideration.
Investors and security holders may obtain copies of these
documents and any other documents filed with or furnished to the
SEC by Verso free of charge through the website maintained by
the SEC at www.sec.gov, or on Verso's investor website,
https://investor.versoco.com/.
Participants in the Solicitation
Verso and its respective directors and certain of its respective
executive officers and employees may be deemed to be participants
in the solicitation of proxies in respect of the proposed merger
under the rules of the SEC. Information about Verso's directors and
executive officers is available in Verso's proxy statement dated on
March 30, 2021 for its 2021 Annual
Meeting of Stockholders. To the extent holdings of Verso securities
by directors or executive officers of Verso have changed since the
amounts contained in the definitive proxy statement for Verso's
2021 Annual Meeting of Stockholders, such changes have been or will
be reflected on Statements of Change in Ownership on Form 4 filed
with the SEC. These documents are available free of charge from the
sources indicated above, and from Verso by going to its investor
relations page on its corporate website at
https://investor.versoco.com/. Other information regarding the
participants in the proxy solicitation and a description of their
direct and indirect interests, by security holdings or otherwise,
will be contained in the proxy statement and other relevant
materials to be filed with the SEC regarding the proposed merger
when they become available. Investors should read the proxy
statement carefully when it becomes available before making any
voting or investment decisions. You may obtain free copies of these
documents from Verso using the sources indicated above.
1 Based on 30.5 million fully diluted shares
outstanding using the treasury stock method.
2 Based on conversion of SEK
9 billion as of December 17,
2021.
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SOURCE Verso Corporation