Cascades gets needed consents for 7¾% notes due 2016, 2017, calls remainder for July redemption

By Jennifer Chiou

New York, June 19 – Cascades Inc. said it received the required consents to approve amendments to the indentures for its $500 million of 7¾% senior notes due 2017 and C$200 million of 7¾% senior notes due 2016.

The company is also tendering for any and all of the U.S. dollar notes and Canadian dollar notes.

As of 5 p.m. ET on June 18, the company received and accepted tenders for $293.7 million of the 7¾% notes and C$147.7 million of the 7¾% notes.

The consents allow the company to, among other modifications, eliminate substantially all of the restrictive covenants and certain events of default in the indentures.

Holders who tender their notes will be deemed to have consented to the proposed amendments.

The tender offer will expire at 9 a.m. ET on July 3. It began on June 5.

Cascades also said that it will redeem any remaining notes at a price of 103.875 plus accrued interest to July 21, the redemption date.

The company stated that it will use the proceeds of its previously completed private offering of 5½% senior notes due 2022 and 5½% senior notes due 2021 to fund the redemption.

Tender details

As reported, the total consideration is $1,043.10 or C$1,043.10 for each $1,000 or C$1,000 principal amount of notes tendered and accepted for purchase. The total consideration includes a $30.00 or C$30.00 consent payment for each $1,000 or C$1,000 of notes tendered by 5 p.m. ET on June 18, the consent payment deadline.

Holders who tender their notes after the consent payment deadline will receive the tender offer consideration of $1,013.10 or C$1,013.10 per $1,000 or C$1,000 principal amount but not the consent payment.

Holders will also receive accrued interest to, but not including, the applicable payment date.

The tender offer and consent solicitation are subject to a number of conditions, including Cascades’ completion of one or more financing transactions resulting in total proceeds of at least $650 million. In addition, for each series of notes, holders of a majority in principal amount of that series need to consent to the proposed amendments for the changes to take effect.

Wells Fargo Securities, LLC (866 309-6316 or 704 410-4760) is the dealer manager and solicitation agent for the U.S. dollar tender offer, and CIBC World Markets Inc. (416 594-8515) is the dealer manager and solicitation agent for the Canadian dollar tender offer.

D.F. King & Co., Inc. (800 290-6426 or 212 269-5550 for banks and brokers) is the information agent for all of the notes and the tender agent for the U.S. dollar notes, and CST Trust Co. is the tender agent for the Canadian dollar notes.

Based in Kingsey Falls, Quebec, Cascades produces, converts and markets packaging and tissue products that are composed mainly of recycled fibers.

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