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Appvion Paper Mill Company Enters Into Purchase Agreement Bid

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Paper mill company enters into purchase agreement bid

 

Paper mill company Appvion has filed for a stalking horse bid to sale the company.  (Photo: Appivon)

ROARING SPRING - Paper mill company Appvion has filed for a stalking horse bid to sell the company.

Stalking horse bid is a financial term, meaning the first bid of a proposed asset sale.

The motion comes after the company went into bankruptcy in October.

 

 

 

Corporate Communications Director Bill Van Den Brandt said if an offer is accepted, the company will no longer be an employee-owned company.

"Many employees and former employees have retirement investments in the form of company stock. Under the purchaser’s offer, the current ESOP structure would not continue and any interests in the ESOP by plan participants would not have any value," said Van Den Brandt.

Appvion has been 100% employee-owned since 2001.

The company creates product solutions through its development and use of coating formulations and applications. The company produces thermal, carbonless, security, inkjet, digital specialty and colored papers.

The bidding process is currently underway.

Officials said the agreement with the purchaser, which is subject to higher or otherwise better offers, provides a total consideration of $325 million, plus the assumption of substantial liabilities.

 

Currently, Appvion has a company locally in Roaring Springs.

Van Den Brandt said 440 employees work at the mill.

"We don't expect the sale process to affect company employees or employment compensation and benefits," said Van Den Brandt.

Under its offer, Van Den Brandt said the purchaser would not assume any liability for current pension plans.

"Those plans would be taken over by the Pension Benefit Guaranty Corporation (PBGC). The PBGC is a federal government agency that guarantees payment of basic pension benefits earned by millions of American workers and retirees participating in over 29,000 private-sector defined benefit pension plans," said Van Den Brandt. "The majority of Appvion pension plan participants will see no change or interruption to the pension payments they currently receive or expect to receive in the future."

According to a release, Appvion intends to allow other qualified bidders the opportunity to submit competing bids through a court-supervised sale process.

"We believe that launching the sale process with a going-concern offer from the purchaser, a long-term lender to and supporter of our business, is the best option for Appvion," said Van Den Brandt. "The transaction would maximize the value of our assets and create the optimal long-term outcome for our employees, customers and vendors."                                                                                                               SEE VIDEO REPORT, TWEETS ;    http://wjactv.com/news/local/paper-mill-company-appvion-enters-into-purchase-agreement-bid

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