Abitibi expected to price $415 million three-year secured notes March 24 week via Goldman Sachs

By Paul A. Harris

St. Louis, March 19 - Abitibi-Consolidated Company of Canada launched its $415 million offering of three-year non-callable senior secured notes (B1) on Wednesday, according to informed sources.

The deal is expected to price during the March 24 week.

Goldman Sachs & Co. is the bookrunner for the offering, which will be marketed via Rule 144A and Regulation S with registration rights.

Proceeds will be used to help address upcoming maturities and liquidity needs.

Other funding for the refinancing will come from $300 million of convertible notes and $256.8 million of exchange senior notes.

Also on Wednesday the company amended the terms of its concurrent exchange offer, which encompasses $496 million of outstanding notes. These include about $195.6 million of 6.95% senior notes due 2008, $150 million of 5¼% senior notes due 2008 and $150 million of 7 7/8% senior notes due 2009.

According to the amendment, the company has increased the consideration to be paid for the exchange.

The company also has provided that the indenture for the exchange notes will include covenants substantially similar to those contained in the indenture for the new senior secured notes.

In addition the minimum tender condition for the 7 7/8% senior notes due 2009 is reduced to 75% from 90%.

The tender condition for the notes maturing in 2008 remains at 90%.

Abitibi is a Montreal-based producer of newsprint and commercial printing papers, market pulp and wood products.

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