Brazil's Fibria offers to buy $500 million 7½% notes via Dutch auction

By Susanna Moon

Chicago, June 12 - Fibria Celulose SA said it began a cash tender offer for up to $500 million principal amount of the $1.87 billion outstanding 7½% senior notes due 2020 issued by wholly owned subsidiary Fibria Overseas Finance Ltd.

The total purchase price will be set using a modified Dutch auction and the total bid range will be par to $1,060, including an early tender premium of $50.00, for each $1,000 principal amount of notes tendered by the early deadline at 5 p.m. ET on June 22.

Holders who tender notes without specifying a bid price will be deemed to have bid par, which is the minimum price allowed under the offer.

The offer will end at midnight ET on July 9. Tendered notes may be withdrawn by the early deadline.

The clearing price will be the single lowest bid price specified that will allow Fibria to purchase a total amount of notes equal to the tender cap, according to a company press release.

If the total amount of notes tendered at a bid price at or below the clearing price exceeds the tender cap, then the company will first accept for purchase all the notes tendered with a bid price less than the clearing price and, after that, notes tendered with a bid price equal to the clearing price on a prorated basis.

Holders also will receive accrued interest up to but not including the settlement date.

The tender offer is conditioned on the company receiving tenders for at least $400 million of notes.

Deutsche Bank Securities Inc. (866 627-0391 or collect 212 250-2955) and Citigroup Global Markets Inc. (800 558-3745 or collect 212 723-6108) are the dealer managers. D.F. King & Co., Inc. (800 488-8095 or for banks and brokers 212 269-5550) is the information agent and tender agent.

Fibria is a pulp and paper company based in Sao Paulo.

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