MOSINEE (WAOW) - Wausau Paper said that a $110 million deal to sell its mills in Rhinelander and Mosinee to a New York private equity firm was signed Monday.
The mills and their specialty paper business will became part of a new company called Expera Specialty Solutions under the deal with KPS Capital Partners, said Hank Newell, president and CEO of Wausau Paper.
"This transaction accomplishes all of our key objectives," Newell said in a statement.
The new company will be better able to compete globally and allow Wausau Paper to focus on growing its tissue business, Newell said.
KPS earlier announced it reached agreement to also acquire the specialty paper business of Packaging Dynamics Corp., which operates mills in DePere and Kaukauna, and they would also become part of Expera once the final deal is signed. "The company expects to finalize the transaction in the second or third quarter of 2013," Newell said Monday.
Wausau Paper said a key part in completing its deal to create the new paper company was ratifying a collective bargaining agreement with the United Steelworker's Union for workers in Mosinee, Rhinelander and Kaukauna.
Newell predicted Expera will become a leading North American manufacturer of specialty paper products for such things as food packaging.
Wausau Paper, founded in 1899, recently closed its mill in Brokaw, eliminating about 450 jobs, and announced it was shutting down its Brainerd, Minn., factory, eliminating 130 jobs.
In January, Wausau Paper said mills in Brainerd, Mosinee and Rhinelander were for sale, as the company planned to focus solely on making tissue and towel, which are produced at its mills in Kentucky and Ohio. The company recently celebrated a $220 million expansion at its Harrodsburg, Ky., mill that the company said would add about 80 jobs.
Newell said Monday the sale of the Rhinelander and Mosinee mills would give Wausau $110 million after "settlement of transaction-related liability, transaction costs and taxes."