Verso Corp. (OTCQB: VRSZ) announced Jan. 7 that it has sold one of its subsidiaries, Verso Androscoggin Power LLC (VAP), to Eagle Creek Renewable Energy LLC for a purchase price of approximately $62 million in cash.
VAP owns four hydroelectric facilities associated with Verso’s Androscoggin pulp and paper mill located in Jay, Maine. The parties contemporaneously entered into a purchase agreement and consummated the transaction. The sale of VAP is part of Verso’s efforts to raise funds to address its previously disclosed cash flow and liquidity concerns. Verso said it continues to evaluate other potential asset sales in connection with its exploration of various debt restructuring alternatives.
The sale of VAP is expected to have no impact on the operations of the Androscoggin mill. The mill purchased electricity from VAP before the transaction, and it will continue to do so with VAP now under Eagle Creek’s ownership. Moreover, the mill operates its own energy cogeneration facilities – consisting of two recovery boilers, a biomass boiler, three steam turbines, and three gas turbines – and also purchases electricity from Central Maine Power.
Verso Corp. is a leading North American producer of printing and specialty papers and pulp.
Eagle Creek Renewable Energy (www.eaglecreekre.com) is an owner, operator and developer of hydroelectric facilities and provides safe, clean, economic renewable energy to electricity consumers in the U.S. Eagle Creek currently owns and operates in excess of 130 MW from 47 facilities. Eagle Creek was founded in 2010, is privately owned and is headquartered in Morristown, New Jersey.