Financing for Domtar acquisition by Paper Excellence to include new Domtar notes

By Paul A. Harris

Portland, Ore., Sept. 20 – Financing for the acquisition of Domtar Corp. by Paper Excellence will include an offering of new Domtar senior notes, according to a market source.

The financing also includes $775 million of new bank debt set to kick off on a Tuesday conference call with lenders. Barclays, BMO Capital Markets Corp., Credit Suisse Securities (USA) LLC and Wells Fargo Securities LLC bookrunners on the bank deal.

Proceeds will be used with senior secured notes to fund the acquisition of the company by Paper Excellence BV for $55.50 per share and finance the potential redemption of Domtar’s existing senior notes.

Closing is expected this year, subject to customary conditions.

After the transaction closes, Paper Excellence intends to continue the operations of Domtar as a stand-alone business entity.

Domtar is a Fort Mill, S.C.-based provider of fiber-based products, including communication, specialty and packaging papers, market pulp and airlaid nonwovens. Paper Excellence is a British Columbia-based diversified manufacturer of pulp and specialty, printing, writing and packaging papers.

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