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Monday, January 6, 2014

Verso Paper to purchase NewPage Holdings for $900 mln, (NYSE: VRS)

Coated paper maker Verso Paper Corp said it would purchase privately held NewPage Holdings Inc for about $900 million in cash and bonds to form a more cost-efficient company that can cope with increasing pressure from digital media.Verso's shares jumped more than 300 percent, valuing the company as much as $146 million.Demand for coated paper from magazines and catalogues has been declining as lower readership and advertising in print media force publishing and media groups to move online."It's sort of like two very weak companies holding each other up," Vertical Research Partners analyst Chip Dillon said.

Verso Paper Corp. (Verso Paper) is a holding company. Shares of VRS traded higher by 200.0% or $1.3/share to $1.95. In the past year, the shares have traded as low as $0.52 and as high as $1.68. On average, 28311 shares of VRS exchange hands on a given day and today's volume is recorded at 1742585.