Svenska Cellulosa asks holders to approve split-off under many notes

By Susanna Moon

Chicago, Oct. 27 – Svenska Cellulosa AB SCA (publ) is soliciting consents for a number of note series to waive any potential events of default related to the proposed split of its hygiene and forest businesses.

The issuer is soliciting consents for its SEK 1.5 billion floating-rate notes due August 2018, SEK 1 billion green floating-rate notes due April 2019, SEK 500 million 2.5% green notes due April 2019, SEK 600 million floating-rate notes due June 2019, SEK 900 million 0.75% notes due June 2019, €300 million 0.5% senior notes due March 2020, €500 million 0.5% senior notes due May 2021, SEK 1.4 billion floating-rate notes due October 2022, €500 million 2.5% notes due June 2023 and €300 million 1.125% senior notes due March 2025.

Svenska Cellulosa is proposing to transfer its hygiene business to a subsidiary called SCA Hygiene AB, then distribute the share capital in this company via dividend to the issuer's current shareholders, according to a company announcement. The shares of SCA Hygiene AB would be listed.

“This proposal aims to optimize shareholder value while incurring relatively low transactional risk and transaction costs,” the company said.

The two listed companies would be SCA Hygiene AB, the hygiene business, and SCA AB, a forest products business.

The proposal requires shareholder approval.

In order to divide the businesses, the issuer has proposed transferring all of the assets and liabilities of the hygiene business to SCA Hygiene AB.

The company will pay 0.25% for consent instructions in favor of the proposal received by 11 a.m. ET on Nov. 10, the early deadline. Noteholders may continue to submit consents after the early instruction deadline but they will not receive the consent fee.

Meetings will be held at 4:30 a.m. ET on Nov. 25 in London.

The consent solicitation will end at 4:30 a.m. ET on Nov. 23.

The solicitation agent is Citigroup Global Markets Ltd. (+44 20 7986 8969 or liabilitymanagement.europe@citi.com). The co-solicitation agent is Nordea Bank Danmark A/S (+45 5547 4253 or NordeaLiabilityManagement@nordea.com). The tabulation agent is Citibank, NA, London Branch (+44 207 508 3867 or exchange.gats@citi.com).

Svenska Cellulosa is a hygiene and forest products company that develops and produces personal care, tissue and forest products.

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