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Eldorado Brasil pulls notes deal after shareholders file injunction
By Rebecca Melvin
New York, Feb. 8 – Eldorado Brasil Celulose SA has postponed its planned offering of senior notes (expected ratings: Ba3//BB-) after a shareholder dispute resulted in an injunction against the sale, according to market sources.
Shareholder Paper Excellence sent letters to the U.S. Securities and Exchange Commission stating that bond investors had received inaccurate information contained in the prospectus, and a court in Singapore blocked the Rule 144A and Regulation S sale, saying that the company must clarify the information.
Roadshow meetings regarding the notes, to be issued via Eldorado subsidiary Eldorado International Finance GmbH and guaranteed by Eldorado Brasil Celulose and Cellulose Eldorado Austria GmbH, had wrapped up on Wednesday, and proceeds were earmarked for liability management, improvements in the company’s debt maturity profile and general corporate purposes.
Eldorado Brasil is a Sao Paulo-based pulp producer. Paper Excellence owns 49.4% in the company and is involved in a dispute with controlling shareholder J&F Investimentos SA over completion of a deal to acquire control of the company.
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