Western Forest gets new credit facility to fund notes redemption

By Sara Rosenberg

New York, Nov. 14 - Western Forest Products obtained a new credit facility from Tricap Management Inc. to redeem the company's $221 million of 15% senior secured notes, according to a news release.

The credit facility consists of a $187.5 million four-year term loan with an interest rate of Libor plus 815 basis points and a C$90 million one-year term loan with an interest rate of Canadian prime rate plus 525 bps.

The Canadian tranche has a one-year extension option.

Western will use the facility to fund the redemption of the senior secured bonds no later than the completion of the acquisition of Cascadia Forest Products Inc. for about C$120 million plus Cascadia's net working capital.

The acquisition of Cascadia is expected to close in the first quarter of 2006, subject to the receipt of regulatory approvals.

For acquisition funding, the company plans to raise C$295 million of equity by way of a rights offering to all shareholders.

Western is a Duncan, B.C.-based forest products company and coastal woodland operator.

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