White Birch sets structure, pricing on $470 million credit facility

By Sara Rosenberg

New York, March 31 - Details surfaced on White Birch Paper Co.'s bank deal, including a size of $470 million, tranche structure and price talk. No bank meeting will take place to launch the deal that is basically replacing the company's previously pulled $400 million bond offering.

The facility consists of a $70 million five-year asset-based revolver, which the company was always planning on getting, with price talk of Libor plus 200 basis points and a commitment fee of 50 basis points, a $275 million seven-year term loan B with price talk of Libor plus 350 basis points and a $125 million eight-year second-lien term loan with price talk of Libor plus 750 basis points, according to a syndicate document.

Credit Suisse First Boston is sole lead arranger and sole bookrunner on the first- and second-lien term loans. Credit Suisse First Boston and Toronto Dominion are joint lead arrangers on the revolver.

Proceeds from the term loans will be used along with cash and borrowings under the new revolver to repay outstanding debt of Brant-Allen Industries and certain of its affiliates, including the company's outstanding 10% senior secured notes due 2007, to purchase the equity interests of certain of Brant-Allen's equity partners and for general corporate purposes.

Originally the Toronto-based newsprint company was going to sell $400 million in bonds, but after restructuring the bond offering twice before, the decision was made on Wednesday to turn it into a bank deal, with the same group of investors, a source previously explained to Prospect News.

Prior to abandoning the bond structure altogether, White Birch was marketing $250 million of seven-year first-lien floating-rate notes that were non-callable for two years. The notes were talked at three-month Libor plus 325 to 350 basis points. White Birch also was marketing $150 million of eight-year second-lien fixed-rate notes that were non-callable for four years and talked in the 10¾% area.

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