Mercer International expects to file for bankruptcy and plans to continue normal operations.

"With the support of the majority of our noteholders and shareholders, we are putting in place a much stronger balance sheet and the liquidity to navigate current pulp and lumber market and geopolitical conditions," Mercer said.

Mercer said about $1.1 billion of senior notes would be exchanged for equity, reducing existing senior note debt by about 88%.

Existing shareholders would receive about 8.5% of the new common stock and 3.5% of the new convertible preferred stock of the reorganized company.