SEATTLE (Scrap Monster): Verso Corporation today announced that it has reached a definitive agreement with Spring Grove, PA-headquartered Pixelle Specialty Solutions LLC to sell its Androscoggin mill at Jay, Maine, and its Stevens Point mill at Stevens Point, Wisconsin. The transaction is valued at $400 million and is subject to regulatory and customary closing conditions. The sale is expected to be completed in the first quarter of 2020.
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The transaction is expected to generate net cash proceeds of approximately $336 million, after accounting for Pixelle assumption of around $35 million of pension liabilities, working capital adjustments and payment of transaction related expenses. A significant portion of the net proceeds will be returned to Verso’s stockholders either by way of dividend or share repurchase. Approximately $54 million will be utilized to reduce a portion of its unfunded pension liability. The remaining proceeds will be used for general corporate purposes.
The financial advisor to the transaction was Houlihan Lokey, whereas Akin Gump Strauss Hauer & Feld LLP acted as the legal Counsel to the company.
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