TimberWest files rights offering for up to C$50 million of convertibles

By Jennifer Chiou

New York, Dec. 24 - TimberWest Forest Corp. announced that it registered a rights offering, under which the company will distribute rights that will entitle existing stapled units holders to buy up to C$50 million in 9% extendible convertible debentures.

Under the offering, the unit holders will receive one right for each stapled unit held. For every 155.53088 rights held, the holder will be entitled to subscribe for C$100 of debentures.

Subscriptions for debentures must be completed by 7:30 p.m. ET on Feb. 9.

The initial maturity date is Feb. 11, 2014.

As previously announced, the company has also entered into an investment agreement with two wholly owned subsidiaries of British Columbia Investment Management Corp., under which they have agreed to purchase C$100 million of convertible debentures.

TimberWest also announced that the proposed amendments to the loan agreement governing its existing credit facilities have now been approved by lenders, subject to the execution of definitive documentation and the fulfillment of certain conditions, including the completion of an offering of convertible debentures of at least C$100 million.

The stapled units are expected to trade on the Toronto Stock Exchange on Jan. 5.

Genuity Capital Markets, as lead manager, together with BMO Capital Markets and Raymond James Ltd. are the dealer managers.

Closing of the offering is set for Feb. 11.

The rights and the debentures are qualified for distribution in each province of Canada by way of a short form prospectus, and in the United States under a registration statement on Form F-7 to be filed with the Securities and Exchange Commission.

Vancouver, B.C.-based TimberWest is a land management company.

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