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Norske Skog begins exchange offers, consent bids for four note series
By Susanna Moon
Chicago, Jan. 23 Norske Skog Holding AS announced exchange offers and consent solicitations for four issues of notes issued by Norske Skogindustrier ASA.
The company is offering to exchange the following notes for cash and euro-denominated senior notes due 2021 or dollar-denominated senior notes due 2033:
$158.2 million of outstanding $200 million 6 1/8% senior notes due 2015;
129.6 million of outstanding 150 million 11Ύ% senior notes due 2016;
388.5 million of outstanding 500 million 7% senior notes due 2017; and
$200 million 7 1/8% senior notes due 2033.
Norske Skogindustrier also is seeking consents to amend each series of notes, according to a company press release.
The exchange offers will end at 11:59 p.m. ET on Feb. 19, with settlement on Feb. 24. The early exchange and consent deadline is 5 p.m. ET on Feb. 4. The offers began Jan. 22.
The noteholder meetings have been set for Feb. 23 in London.
Exchange terms
In exchange, the company is offering to issue up to
385 million 8% notes due Feb. 24, 2021;
$138 million 8% notes due Feb. 24, 2023; and
$143 million 8% notes due Oct. 15, 2033.
The exchange value with exchange ratio and cash amount for each $1,000 or 1,000 principal amount will be as follows:
For 6 1/8% notes, an amount of notes due 2021 with an exchange ratio of 55% and cash amount of $530;
For 11Ύ% notes, notes due 2021 with an exchange ratio of 60% and cash amount of 330;
For 7% notes, notes due 2021 with an exchange ratio of 68.125% and cash amount of 55; and
For 7 1/8% notes, the exchange ratio will be 68.75% if exchanged for notes due 2023 and 71.25% if exchanged for notes due 2033 and there will be no cash amount. For the 7 1/8% notes, if the 2016 notes consent is obtained by the expiration time, holders will receive an amount of new dollar-denominated 8% senior notes due 2023; otherwise, an amount of new dollar-denominated 8% senior notes due 2033.
The early instruction fee will be $20.00 per $1,000 par amount or 20.00 per 1,000 of notes.
The cash participation incentive is as follows: For the first three series of notes those due 2015, 2016 and 2017 if the proceeds from the new notes offering exceed 225 million and 80% of the par amount of any series tenders their notes for exchange, and then again for each additional 5% of the par amount of that series the cash amount for the series will be bumped up by 10 per 1,000 or $10 per $1,000 and the exchange ratio for the series will drop by 1.25%, according to a company press release.
Norske Skogindustrier holds $41.8 million principal amount of the 2015 notes, 20.4 million principal amount of the 2016 notes and 111,534,000 principal amount of the 2017 notes. Norske Skogindustrier intends to vote in favor of the 2015 notes proposal but is not entitled to vote its 2016 notes nor its 2017 notes, the release noted.
The exchange notes will be issued in denominations of 100,000 and integral multiples of 1,000 after that for the notes due 2021 or $150,000 and integral multiples of $1,000 for the notes due 2023 and 2033.
Holders must tender for exchange notes with an aggregate nominal amount of $238,000 for the 2015 notes, 187,000 for the 2016 notes, 162,000 for the 2017 notes and $219,000 for the 2033 notes.
More details
Norske Skogindustrier plans to issue 250 million of senior secured notes due 2019 through one of its subsidiaries. The exchange offers is conditioned on the notes placement or alternative funding.
The notes offering is not contingent upon the completion of the exchange offers or the consent solicitations; however, Norske Skogindustriers ability to issue all of the 250 million of new senior secured notes will require receipt of required consents under the solicitations.
To date, the proposed issue would exceed the amount of secured debt permitted to be incurred under the notes indenture and agency agreements, which would have permitted a maximum of 179 million principal amount of additional secured debt as of Dec. 31, the company said.
The dealer managers are Goldman Sachs International (+44 0 207 774 9862, 800 828-3182 or 212 902-6941 or email: liabilitymanagement.eu@gs.com) and Citigroup Global Markets Ltd. (+44 20 7986 8969, 800 558-3745, 212 723-6106 or email: liabilitymanagement.europe@citi.com).
The exchange and tabulation agent is Lucid Issuer Services Ltd. (+44 20 7704 0880, attn: Thomas Choquet/Yves Theis or email: norskeskog@lucid-is.com).
Norske Skog is an Oslo-based paper and pulp company.
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