Mercer starts roadshow for $650 million two-part notes offering

By Paul A. Harris

Portland, Ore., Nov. 12 – Mercer International Inc. began a roadshow on Wednesday for a $650 million two-part offering of senior notes (B2), according to a syndicate source.

The Rule 144A and Regulation S with registration rights deal, which is expected to price early in the week ahead, features a $250 million tranche of five-year notes, which become callable after two years at par plus 50% of the coupon.

In addition Mercer is offering $400 million of eight-year notes, which become callable after three years at par plus 75% of the coupon.

Credit Suisse Securities (USA) LLC, Barclays and RBC Capital Markets are the joint bookrunners.

The notes in both tranches feature 35% equity clawbacks during their respective non-call periods and 101% poison puts.

Proceeds will be used to refinance debt.

The prospective issuer is a Northern bleached softwood kraft (NBSK) pulp producer and seller of surplus “green” energy and is based in Vancouver, B.C., with U.S. headquarters in Seattle.

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