RHINELANDER - Wausau Paper today announced that it has signed a definitive agreement to sell its specialty paper business to a new company sponsored by KPS Capital Partners L.P. (“KPS”), a New York-based private equity firm with significant experience in the paper industry.
The new company will be known as Expera Specialty Solutions, LLC (“Expera”).
KPS, as previously announced, has also entered into a definitive agreement to acquire the specialty paper business of Packaging Dynamics Corporation
(“Thilmany”), which operates paper mills in De Pere and Kaukauna, Wisconsin.
Expera will combine the Thilmany business with Wausau Paper’s specialty paper business to create a leading North American manufacturer of specialty paper products for the food packaging, industrial, and pressure-sensitive release liner segments.
A collective bargaining agreement covering employees at the Mosinee, Rhinelander, and Kaukauna facilities has been negotiated and ratified.
The collective bargaining agreement and the Thilmany acquisition agreement were both conditions to Wausau Paper entering into its agreement with KPS.
Key highlights of the transaction are as follows:
• The transaction will result in net cash proceeds to Wausau Paper of approximately $110 million after settlement of transaction-related liabilities, transaction costs and taxes.
• Expera will acquire the assets of Wausau Paper’s Rhinelander and Mosinee mills; the assets of the company’s Brainerd mill are not included in the transaction.
• Wausau Paper will retain defined benefit pension and other post-retirement benefit obligations; however, effective with the closing of the transaction, approximately $41 million of future liability will be eliminated.
• Wausau Paper will not hold any equity ownership in Expera.
• Wausau Paper will have the opportunity to receive a contingent payment that would be equal to what the holder of a 5% equity interest in Expera would receive if certain performance thresholds and KPS liquidity events occur.
Hank Newell, president and CEO of Wausau Paper, commented, “This transaction accomplishes all of our key objectives: divesting our paper business in a way that creates value for our shareholders, creating a specialty business under new ownership with the scale and product breadth to compete globally, and narrowing our focus to accelerating growth in our tissue business.”
The transaction has received required regulatory approval under the Hart-Scott-Rodino Antitrust Improvements Act. Other customary conditions to closing, including third party financing, remain.
The Wausau Paper sale to Expera is also conditioned upon Expera completing the acquisition of the Thilmany business.
While the company expects to finalize the transaction in the second or third quarter of 2013, there can be no certainty or assurance about the timing or completion of a transaction.
Mesirow Financial, Inc. and Ruder Ware, L.L.S.C. have been the financial and legal advisors to Wausau Paper.
MADISON - A Wisconsin Rapids woman will spend three years on probation for threatening to kill a federal administrative law judge.
51-year-old Norma Prince was sentenced Thursday. Prince pleaded guilty in December.
Prosecutors say the incident happened Jan. 31, 2013, when Prince appeared at a Social Security disability benefits hearing in Wausau.
Administrative Law Judge Thomas Sanzi was presiding over the hearing by teleconference from Madison. Prosecutors say Prince became upset and threatened to shoot Sanzi and cut off his head. The hearing was halted and Prince was escorted from the courtroom.
Prince's husband told a federal agent that his wife had bought two .22-caliber rifles about a month before the disability hearing.
At sentencing, U.S. District Judge Lynn Adelman said Prince's mental health issues can be controlled through medication and supervision.
ACROSS THE NORTHWOODS - Senate and House Representatives hope a wildfire disaster bill will help the U.S. Forest Service battle forest fires and still have funding to do its job.
The Wildfire Disaster Funding Act of 2013, SB 1875, would treat extreme forest fires like a natural disaster. That would trigger access to separate pool of funding that would help some lawmakers believe would substantially help the Forest Service.
President Obama included the reforms in his proposed 2015 budget released earlier this week. The reforms would change how the government pays to fight wildfires.
Since 2002, The Forest Service has spent nearly $3 billions dollars of its funding to fight forest fires.
According to the department, Congress paid back the majority of that money, but that still delayed services from the department because payments were done after the fact.
That meant the Forest Service had to pull money away from programs like timber management and fire prevention programs to pay for fire suppression.
Sen. Tammy Baldwin-(D) Wisc. believes that is hurting the department and ultimately businesses and workers that rely on timber harvests in the national forests.
"Because we have had so much severe wildfires, it has left the rest of the forest service with insufficient resources to do their job," Baldwin said.
The Forest Service says funding is one of their key obstacles to increasing timber harvests.
The Chequamegon Nicolet National Forest(CNNF) stretches across parts of Northern Wisconsin. The forest's land management plan allows more than 130 million board feet of timber to be harvested every year, but only half of that allowable level has been harvested each of the past few years.
Baldwin believes the proposal would give the department more resources to improve harvest and land management.
"That will in my mind, in my mind if we are successful in seeing this through," Baldwin said. "We'll safeguard the funding that is really supposed to be used for other purposes to maintain healthy forests in the United States."
That will allow the Forest Service to use resources for the purpose they were intended for.
Baldwin hopes the Wildfire Disaster Funding Act gives leaders at the CNNF the resources to harvest levels closer to the allowable levels.
"The idea here is to that when we have an extreme wildfire event that they will be treated as the natural disasters that they are," Baldwin said. "And that a separate stream of funding will be used."
According to a American Forest Foundation report, the proposal would creates a budget cap adjustment for a 30% portion of wildfire disaster funding for USFS and DOI. They compare the structure to what the Federal Emergency Management Agency (FEMA) uses for other natural disaster response.
Most of the senators and representatives that are sponsoring the legislation come from states impacted by wildfires and the timber industry.
"We'll be leading this effort and we're just hopeful that we'll be able to see some progress," Baldwin said.
The proposal is in committee in both the House and Senate. Baldwin says she’s confident they’ll see progress with it this year. Rep. Reid Ribble-(R) Wisc. is a co-sponsor of the House version of the bill.
RHINELANDER - Your water and sewer bill could soon be on the rise if you live in Rhinelander.
Unlike other Northern Wisconsin cities, the water utility rates haven't changed since 2008.
The public works director says the cold winter only played a small role in the proposed increase.
Rising expenses and upgrades are the main reasons they hope to soon raise utility costs.
"Sewer rates are going up 13 percent in the city largely due to the expenses the utility has experienced because of the upgrades that have taken place and our best efforts to deliver the utility at a low expense," said Public Works Director Tim Kingman.
ROTHSCHILD - Wisconsin farms play a key role in our economy, but today's farm owners aren't getting any younger.
One apprentice program hopes to change that.
The Dairy Grazing Apprenticeship program is building and preparing the next generation of farmers. It gives young farmers hands-on training and a path to a career in dairy farming.
"There's a lot of farms that are going to be transitioned and transferred in the next decade or so, and what we really need is somebody to be able to take these farms over," says program director Joe Tomandl. "We don't have that training program in place, and that's what the dairy grazing apprenticeship is about."
A recent government census of American agriculture found the average age of a farmer is 58 years old. Leaders believe the apprentice program has already seen success with new farmers over the past few years.
"We have a number of new producers just in the last four years in Marathon and Lincoln counties now running their own dairy farms using managed grazing techniques," says Paul Daigle of the Marathon County Conservation, Planning, & Zoning Department. "It's still a struggle no matter what, but it offers a profitable way to get into farming today."
Cattle farmers met at the 20th Annual Winter Grazing Conference today in Rothschild.
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