Domtar plans exchange offer for four series of notes, to seek consent to exchange two other series of notes

By Angela McDaniels

Seattle, Sept. 26 - Domtar Corp. plans to hold an exchange offer under which it will swap newly issued notes for any of Domtar Inc.'s outstanding U.S. dollar-denominated 7 7/8% notes due 2011, 5 3/8% notes due 2013, 7 1/8% notes due 2015 and 9½% debentures due 2016.

The new notes will be issued by Domtar Corp. and will have identical interest rates and maturity dates.

Domtar Corp. will also solicit consents to amend the note indentures, according to a company news release.

Domtar Inc. will concurrently solicit proxies from holders of its outstanding Canadian dollar-denominated 10% debentures due 2011 and 10.85% debentures due 2017 for use at a meeting of debenture holders.

At the meeting, Domtar Inc. will seek approval to amend the indentures to give Domtar Corp. the right to acquire the debentures in exchange for an equal amount of Domtar Corp.'s newly issued Canadian dollar-denominated debt securities with identical interest rates and maturity dates.

J.P. Morgan Securities Inc. will be the lead dealer manager and lead solicitation agent for the U.S. dollar-denominated notes, with Deutsche Bank Securities Inc. as co-dealer manager and co-solicitation agent.

Scotia Capital Inc. and Scotia Capital (USA) Inc. will be the dealer managers for the Canadian proxy solicitations.

Domtar Corp. is a Montreal-based paper company. It is the result of the merger of Domtar Inc. and Weyerhaeuser Co.'s fine paper business, which closed in March.

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