By Paul A. Harris
Portland, Ore., Nov. 18 – Mercer International Inc. priced $650 million of senior notes (B2/B+/) in two tranches on Tuesday, according to a syndicate source.
A $250 million tranche of five-year notes priced at par to yield 7%, on top of yield talk.
A $400 million tranche of eight-year notes price at par to yield 7¾%, at the wide end of the 7½% to 7¾% yield talk.
Credit Suisse Securities (USA) LLC, Barclays and RBC Capital Markets were the joint bookrunners.
Proceeds will be used to refinance debt.
The 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.
| Issuer: | Mercer International Inc.
|
| Amount: | $650 million
|
| Securities: | Senior notes
|
| Bookrunners: | Credit Suisse Securities (USA) LLC, Barclays, RBC Capital Markets
|
| Co-managers: | Macquarie Capital (USA) Inc., Raymond James & Associates Inc.
|
| Trade date: | Nov. 18
|
| Settlement date: | Nov. 26
|
| Ratings: | Moody's: B2
|
| Standard & Poor's: B+
|
| Distribution: | Rule 144A and Regulation S with registration rights
|
| Marketing: | Roadshow
|
|
|
| Five-year notes
|
| Amount: | $250 million
|
| Maturity: | Dec. 1, 2019
|
| Coupon: | 7%
|
| Price: | Par
|
| Yield: | 7%
|
| Spread: | 536 bps
|
| First call: | Dec. 1, 2016 at 103.5
|
| Equity clawback: | 35% at 107 until Dec. 1, 2016
|
| Price talk: | 7% area
|
|
|
| Eight-year notes
|
| Amount: | $400 million
|
| Maturity: | Dec. 1, 2022
|
| Coupon: | 7¾%
|
| Price: | Par
|
| Yield: | 7¾%
|
| Spread: | 560 bps
|
| First call: | Dec. 1, 2017 at 105.813
|
| Equity clawback: | 35% at 107.75 until Dec. 1, 2017
|
| Price talk: | 7½% to 7¾%
|
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