Verso forms strategic committee which could consider mill sale

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A truck leaves Verso Mill in Jay.

JAY — Verso Corp. announced Thursday that its board of directors, as part of its ongoing efforts to maximize stockholder value, has formed a Strategic Alternatives Committee.

The announcement follows two days after shareholders linked to investor Jason Mudrick reported being “deeply frustrated with the board’s inaction to address the issuer’s rapidly deteriorating financial position” and want to “enact a strategic plan that will return value to stockholders, including a potential sale of the Stevens Point (Wisconsin) and Androscoggin (Jay) mills.”

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The Strategic Alternatives Committee is comprised of independent directors Eugene I. Davis, Alan J. Carr and Steven D. Scheiwe, with Davis serving as chairperson, according to a news release.

The committee, with the assistance of Houlihan Lokey Capital, Inc., the company’s financial advisor, will lead Verso’s continuing efforts to identify and evaluate a range of potential strategic transaction alternatives, including the possible sale of some Verso mills; engage in discussions and oversee the due diligence process with parties potentially interested in transactions with the company; and recommend to the board whether any proposed transaction is in the best interests of the company and its stockholders, the release stated.

“Verso is committed to exploring strategic transaction alternatives, and the committee will facilitate this process,” said Rob Amen, Verso chairman of the board, according to a release. “The committee is charged with proceeding expeditiously, but will evaluate alternatives carefully for their ability to provide superior value to Verso’s stockholders.”

Verso offered no assurance that the review of strategic alternatives will result in any transaction or other strategic alternative. Verso does not intend to make any further disclosure concerning these matters until a definitive transaction agreement is reached or a determination is made that none will be pursued, according to the release.

Since late 2015 nearly 500 workers have lost jobs at the Androscoggin Mill in Jay. Verso announced in November 2015 that it would look at possibly selling the paper mill in its efforts to restructure its balance sheet and explore opportunities to raise funds to meet financial obligations.

In November 2016 the company announced it would lay-off about 190 workers during the first quarter of 2017. In July, 120 of those jobs were permanently eliminated. Verso also permanently eliminated 300 positions in late 2015. The company has shut down two paper machines, a pulp dryer, digester, recovery boiler and related equipment over the past two years. It leaves two paper machines at the mill and less than 400 employees.  

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