A former employee of Verso Corp. is back with a new offer to buy the company.
Atlas Holdings LLC, in a filing with the Securities and Exchange Commission, the company is offering $ 20 per share for the outstanding shares of Verso, repurchasing Verso in full. The estimated value of the company is $ 866 million, according to Atlas Holdings.
Atlas sent a letter to Verso on Sunday via email, announcing its proposed purchase of Verso, claiming that the company is already a long-term investor in Verso, owning shares representing around 9% of the company’s voting rights. Timothy Fazio, Managing Partner of Atlas Holdings, said Atlas is “extremely excited about this proposed transaction.”
Verso stock jumped 10.4% on Monday, closing at $ 19.04 per share.
The company had already tried unsuccessfully to buy Verson between late 2017 and 2019. Verso sold its Stevens Point and Jay, from factories in Maine to Pixelle Specialty Solutions early 2020.
In 2020, however, Verso encountered additional complications from the COVID-19 pandemic. He indefinitely close factories in Wisconsin Rapids and Duluth, Minnesota due to the drop in demand when the pandemic hit. Back sold its Duluth plant in May, and he negotiated with interested parties for the Wisconsin Rapids plant.
Atlas Fund, a Greenwich, Connecticut-based company was founded in 2002. It owns and operates 23 companies with approximately 40,000 employees. She also has experience in the pulp and paper industry, owning and operating an uncoated paper manufacturer, book producer, Canadian pulp manufacturer and tissue paper manufacturer.
“We believe Atlas is the ideal acquirer for the company given our expertise in executing complex transactions and our experience in the pulp, paper and packaging industry,” Fazio wrote in the letter of offer.
A sale of Verso would require the approval of Verso’s board of directors and its shareholders.
Representatives for Verso did not immediately respond to a request for comment on Monday afternoon.
Republican State Representative Scott Krug from Nekoosa said on Monday that he believed Verso was likely to sell to Atlas. Krug, who has been involved in local efforts to support former Verso employees and the community through the Wisconsin Rapids Together task force, said local officials will connect with Atlas to discuss its plans for the Wisconsin Rapids plant and reopening production if the sale is approved.
Krug was the author of the “Mill Bill”, vetoed Governor Tony Evers last week, who allegedly authorized the loan of $ 65 million in federal coronavirus relief funds to a buyer to purchase the Wisconsin Rapids and Park Falls paper mills. Evers said he supported efforts to restart factories, but objected to the source of funding.
Krug said there was always a possibility for the legislature to override that veto, while Democrats said they wanted to work with Republican lawmakers to find another way to fund the loans. If either happens, the federal loan could be applicable to help with the sale.
On Monday afternoon, Democratic lawmakers introduced new legislation similar to the previous bill that included amendments that had been rejected for that bill. The loans would come from the state’s planned budget surplus instead of federal funds.
In his letter, Fazio said Atlas’s proposal was not dependent on any third-party funding. He said the company has sufficient resources to complete the acquisition quickly.
Krug said recent announcements that two paper companies, Clearwater paper and Neenah Inc, would shut down operations in Fox Valley demonstrates a broader need for the state to help the paper industry across Wisconsin.
“We have to look at the industry as a whole, to see how we can help,” Krug said. “In this whole process, we see other (factories) shutting down. It’s bigger than us.