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Verso Corporation to be Acquired by BillerudKorsnäs AB for $27 Per Share in Cash, or Approximately $825 Million

MIAMISBURG, Ohio (News release) -- Verso Corporation 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 million. 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.

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