AN AERIAL VIEW of the Verso Corp. pulp and paper mill in Quinnesec.

ESCANABA — BillerudKorsnäs has completed its acquisition of Verso Corp.

Employees were informed of the development Thursday after the sale became official.

Verso had received all necessary approvals to finish the merger earlier this week and stockholders voted earlier in March to approve the merger.

The plan for the merger was made public in December. Verso said it had entered into an agreement under which BillerudKorsnäs, a Swedish pulp and paper company, would acquire all outstanding shares of Verso for $27 per share, or about $825 million.

The merger will change production at the Escanaba mill, according to information the company released in December.

BillerudKorsnas 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 about 1,200,000 tons (1,100 ktonnes). BillerudKorsnas estimates it will invest about $1 billion for the conversion project.

In addition to continued paper production in Escanaba during the conversion, BillerudKorsnas 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 of graphic and specialty papers and 240,000 tons of market pulp a year.

The acquisition of Verso reinforces BillerudKorsnäs’ strategy to drive profitable and sustainable growth and its ambition to accelerate its growth in North America. As a result of the acquisition of Verso, BillerudKorsnäs is now among the largest providers of virgin paper and packaging materials with a cost and quality advantage. Combined 2021 net sales for BillerudKorsnäs and Verso amounted to approximately SEK 37.2 billion.

BillerudKorsnäs is committed to continuing to serve Verso’s customers across all segments and realizing its previously announced plans to convert several of Verso’s assets into paperboard machines, while maintaining Verso’s position as a quality and cost leader in speciality and coated paper, the company said in a press release.

Effective today, Rob Kreizenbeck, Verso’s senior vice president of operations, assumes the position of president, North America in BillerudKorsnäs’ executive management team.

Going forward, BillerudKorsnäs intends to simplify its company name and brand to “Billerud,” which it will operate under in all markets, including the U.S. The board of directors will propose at the 2022 annual general meeting to amend the company’s name to Billerud AB (publ), and the change will be successively implemented thereafter.

“I am very glad to welcome the entire Verso team to BillerudKorsnäs. Our combined assets and expertise in high-quality virgin fibre paper and board packaging materials create an excellent platform for sustainable and profitable growth. Integration work starts immediately, and we look forward to working together, sharing knowledge, initiating preparations for the conversion project and realizing a successful development,” said Christoph Michalski, president and CEO of BillerudKorsnäs.

“We are excited to join forces with BillerudKorsnäs and become a larger, stronger organization. Together, we are building a company that is passionately committed to a strong safety culture, sustainability, superior quality and delivering value to our customers,” Kreizenbeck said.

The negative cash flow effect of the acquisition for BillerudKorsnäs amounts to approximately SEK 6.0 billion. The transaction was financed by bank loans, which BillerudKorsnäs plans to refinance through the issuance of debt instruments and an equity rights issue during 2022. Verso will be consolidated in BillerudKorsnäs’ accounts from today and will be reported in the product area Paper. BillerudKorsnäs expects the acquisition to be accretive to earnings per share immediately and to create significant shareholder value over time with a more profitable product mix.

The date of publication of BillerudKorsnäs’ interim report for the first quarter 2022 has been changed to May 5.

As a result of the transaction, Verso common stock ceased trading on the New York Stock Exchange before the opening of trading Thursday.