March 22. 2013 7:00AM - Last modified: March 22. 2013 7:28AM

WAUSAU - New York firm plans to buy Wausau Paper mills

Wausau Paper, of Mosinee, said late Thursday it has signed a non-binding letter of intent to sell its Rhinelander and Mosinee specialty paper mills to NewCo, a new company to be formed and controlled by investment funds sponsored by KPS Capital Partners, for $130 million cash.

KPS also has signed a non-binding letter of intent to buy another company and combine it with the operations of the two Wisconsin mills. The other company was not named in Wausau Paper's news release.

The deal will require members of the United Steelworkers union to ratify new contracts with NewCo, and Wausau Paper will retain certain pension and post-retirement costs related to the two mills to be sold. The two Wisconsin mills had a total of nearly 850 employees, as of February.

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