Rayonier Advanced amends ratio testing date for 2014 credit agreement

By Wendy Van Sickle

Columbus, Ohio, June 6 – Rayonier Advanced Materials Inc. amended its credit agreement dated June 24, 2014 on Monday to provide that some financial ratios will be tested as of the May 24 signing of the company’s arrangement agreement to acquire Tembec Inc. rather than the date the acquisition closes, according to an 8-K filed with the Securities and Exchange Commission.

Bank of America, NA is the credit agreement’s administrative agent.

Tembec is being bought for either C$4.05 in cash or 0.2302 of a share of Rayonier Advanced Materials common stock, for each Tembec common share. These elections are subject to proration to ensure that no more than 63% of the aggregate Tembec shares shall receive the cash consideration and no more than 37% will receive the stock consideration, as previously reported.

The purchase price is about $807 million, including the assumption of $487 million of debt net of cash.

Other funds for the transaction will come from cash on hand.

Closing is expected in the second half of this year, subject to Tembec shareholder approval, court approvals, regulatory approvals and other customary conditions.

Pro forma net leverage is 3.1 times at closing.

Rayonier Advanced Materials is a Jacksonville, Fla.-based supplier of high purity cellulose. Tembec is a Montreal-based manufacturer of forest products.

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