Sino-Forest to sell $400 million seven-year convertible bonds; pricing expected Dec. 7 week

By Rebecca Melvin

New York, Dec. 1 - Sino-Forest Corp. plans to price $400 million of seven-year convertible bonds.

The bonds will be issued by way of a private placement in the United States, a short form prospectus offering in Canada, and internationally via a syndicate of initial purchasers with Credit-Suisse Securities Canada and TD Securities as joint bookrunners, and including Dundee Securities, RBC Dominion Securities, Scotia Capital, CIBC World Markets, Bank of America Merrill Lynch, Canaccord Capital and Maison Placements Canada.

There is a greenshoe of 15%.

Sino-Forest also plans to price $300 million of common stock.

Talk on the coupon and premium wasn't yet available; while final pricing was expected Dec. 10 after the close.

The bonds will be non-callable for life and will rank pari pasu to Sino-Forest's outstanding 5% convertibles due 2013.

Proceeds will be used to repay term loan debt of about $150 million, for commercial plantation timber under its Guizhou master agreement of about $250 million and for forestry investments in cooperation with state-owned plantation entities in the People's Republic of China totaling about $200 million.

Remaining funds are earmarked for payments required in connection with its Mandra Forestry transaction and for general corporate purposes.

Sino-Forest is a commercial forest plantation operator in China. Its common shares trade on the Toronto Stock Exchange under the symbol TRE.

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