PORTLAND, Maine (From The Bangor Daily News) -- The bankrupt Verso Corp. has rejected a contract allowing a Wisconsin papermaker to use the No. 5 paper machine at its Jay mill, which Verso said this week it will use instead to make a new grease-resistant paper to sell to food service businesses.

Verso on Thursday announced the release of its new product on Jay's No. 5 paper machine, which it said will be used for items such as deli wraps, food service liners, microwave popcorn bags and laminated food pouches.

Food packaging generally is expected to grow in the coming years, according to a forecast from the Association for Packaging and Processing Technologies, and paper products are a portion of that.

Kathi Rowzie, a spokeswoman for Verso, wrote in an email that the market for specialty papers is growing and the Jay mill is already filling orders for the new product, called GlazeGuard.

Rowzie wrote the machine "is a great fit with the rest of our specialty products platform, and its return to Verso's manufacturing system expands our opportunities to drive innovation in the specialty papers market. Overall, this is good news for Verso, the Androscoggin Mill, our specialty customers and other stakeholders."

Verso's move to make a new product on its No. 5 paper machine comes about a week after a Delaware bankruptcy judge approved letting the company reject a contract initially signed between Expera Specialty Solutions and the mill's former owner, International Paper.

Verso and 26 subsidiaries filed for bankruptcy in January after its leveraged buyout of larger competitor NewPage for $1.4 billion.

That contract was due to expire in 2017, but the bankruptcy court found that Verso's request to reject the contract was in the best interest of the company and its creditors as it seeks to restructure under Chapter 11.

Expera spokeswoman Addie Teeters said the Wisconsin firm is no longer taking orders for products made on the No. 5 machine, after rejection of that contract.

"We have had discussions with Verso through the process and expect discussions to continue," Teeters said.

Verso announced its plans to sell its own products from the No. 5 paper machine last week. It said in news release that the agreement required it sell paper to Expera "at a price essentially equivalent to Verso's cost of producing the paper."