Verso Paper to buy New Page in $1.4 bn deal

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Coated paper maker Verso Paper Corp and New Page Holdings Inc have entered into a definitive agreement under which Verso will acquire New Page in a transaction valued at $1.4 bn. The deal is expected to save at least $175 million in pretax costs in the first 18 months after the closing, the companies said. No immediate plans to close any mills were announced.

New Page shareholders will receive a total cash and debt consideration of $900 million as well as a 20 to 25 per cent stake in Verso. Verso will also take on $500 million in New Page debt.

The combined company will have annual sales of about $4.5 bn and 11 manufacturing plants with a combined paper production capacity of 5 million tons.

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