Buyer Won’t Reopen Verso Mill; City Official Calls Sale “Encouraging”
Verso Paper is selling its shuttered Sartell paper mill, which was damaged last year by a fire.
It’s unclear what exactly the future holds for the property, but the new owner reportedly plans to disassemble the plant and will not reopen the paper mill.
Verso said in an e-mailed statement that it has reached an agreement to sell “substantially all of the assets” of the mill to AIM Development (USA), LLC, adding that it expects to close the deal during the first quarter of this year.
Verso did not disclose the financial terms of the transaction, and a company spokesman declined to provide additional details.
“Verso does not intend to issue a news release or make any other public statement regarding the transaction except as may be required by law,” the company said.
A May fire at the plant in Sartell, a city located about 10 miles north of St. Cloud, killed one employee and injured several others. Following the explosion, Verso laid off the bulk of its employees at the facility and in August announced that it would permanently shut down the location.
AIM Development on Monday filed for incorporation with the Minnesota Secretary of State’s Office. Its filing lists a “registered office” at 100 South Fifth Street in Minneapolis.
Minnesota Public Radio (MPR) reported that the mill will not reopen under its new ownership; the new owner is a scrap metal and recycling business, which plans to disassemble the plant and explore options for development there, according to MPR.
Sartell City Administrator Patti Gartland told Twin Cities Business in a Wednesday phone interview that the city was notified on Tuesday of Verso’s impending sale, “just minutes” before the company issued its statement to the media. The city inquired about the intentions of the buyer and its background but was “declined that information,” and city officials had not made contact with the buyer as of Wednesday, she added.
“We’re trying to learn: What is their aim, what do they do, and what is their interest?” Gartland said. “Time will tell.”
Despite the lack of details, Gartland said it is “encouraging” that Verso found a buyer for the property, and the city is “looking forward to learning more.” The new owner will likely need to work closely with the city, as any demolition or construction at the damaged mill will require proper permits.
News surfaced in December that Verso had been fined $39,200 after being cited for two violations by the Occupational Safety and Health Administration. A state fire marshal’s investigation reportedly found that an overheated air compressor ignited oil vapors in an air receiving tank, which ruptured and caused the May explosion. The disaster caused an estimated $50 million in damage, according to a Star Tribune report.
While it’s yet to be seen what the sale of the paper mill means for Sartell and the surrounding area, there have recently been other positive economic developments in the St. Cloud region. For example, German farm equipment manufacturer Geringhoff is investing $20 million to establish a factory in the city, where it expects to employ 100 people. Another major area employer, Appert’s Foodservice, said recently that it would be sold to food distribution giant Sysco, which is expected to retain the company’s 300 workers and could add more jobs.