Fortress Paper runs one-year issuer bids for 6.5% and 7% convertibles

By Susanna Moon

Chicago, Jan. 4 – Fortress Paper Ltd. said it plans to make one-year normal course issuer bids for its C$40.25 million of outstanding 6.5% convertible unsecured subordinated debentures due on Dec. 31, 2016 and its C$69 million outstanding 7% convertible unsecured subordinated debentures due on Dec. 31, 2019.

On Wednesday, Fortress Paper may begin making purchases from time to time for up to C$4,025,000 principal amount of the 6.5% convertibles and C$6.9 million principal amount of 7% convertibles, each representing 10% of the public float of the listed security, according to a company notice.

The bid will run until Dec. 30, 2016 for the 6.5% convertibles and on Jan. 5, 2017 for the 7% convertibles or earlier if Fortress Paper has completed its purchases of the debentures subject to the bid.

The company will purchase the convertibles at the market price of up to a daily maximum of $6,000 principal amount of each series of convertibles, representing 25% of the average daily trading volume of each security over the previous six months.

Fortress Paper said it has not acquired any 6.5% convertibles or 7% convertibles over the past 12 months.

The company said that, given the recent trading prices of the convertibles, the purchases may represent an attractive use of funds to reduce its interest expense and its outstanding debt at below face value.

Fortress Paper is a producer of security and other specialty papers and is based in North Vancouver, B.C.

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