Verso Paper Corp. of Tennessee moved closer to acquiring NewPage Holdings Inc., North America's largest coated paper producer, for around $1.4 billion. A condition of the deal, first announced in January 2014, requires Verso to develop a debt-restructuring plan for NewPage.
The Wisconsin Rapid Tribune reports Verso has been successful in getting 75.6 percent of creditors, who hold $299.5 million in second-lien notes, to reduce the amount the company owes in those notes by about 40 percent, while also getting 71.6 percent of subordinated note holders to agree on an offer. Together, this exceeds the 70 percent participation requirement to complete the deal.
On August 5, NewPage Holdings reported its results for the second quarter of 2014, which included a net loss of $30 million compared to a net loss of $13 million in the second quarter of 2013. The increase in net loss, according to NewPage, was in large part due to higher input costs of $20 million and lower paper prices. NewPage's adjusted EBITDA was $43 million in the second quarter of 2014 compared to $50 million in second quarter of 2013.
NewPage ended the second quarter with total liquidity of $271 million, consisting of $263 million of availability under the revolving credit facility and $8 million of available cash and cash equivalents.
Read the full Wisconsin Rapid Tribute article, Verso one step closer to acquiring NewPage.