WestRock and its subsidiaries sign loan deals totaling $4.9 billion

By Wendy Van Sickle

Columbus, Ohio, July 2 – WestRock Co., the company formed from the merger of MeadWestvaco Corp. and Rock-Tenn Co., obtained a five-year $2.3 billion senior unsecured term loan and a five-year $2 billion senior unsecured revolving credit facility on Wednesday, according to an 8-K filed with the Securities and Exchange Commission.

Also on Wednesday, a subsidiary of WestRock Co. entered into a $600 million term loan, according to the filing.

Interest on the revolver and the $2.3 billion term loan is initially at Libor plus 125 basis points. Interest will range from Libor plus 100 bps to Libor plus 150 bps, based on either the company’s corporate credit ratings or its leverage ratio, whichever yields a lower rate.

There will also be annual fees of 12.5 bps to 30 bps, based either on corporate credit ratings or leverage ratio.

Wells Fargo Bank, NA is the administrative agent.

Wells Fargo Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Inc., Barclays Bank plc, CoBank, ACB, Bank of Tokyo-Mitsubishi, Ltd., Citigroup Global Markets Inc., HSBC Securities (USA) Inc., J.P. Morgan Securities LLC, PNC Capital Markets LLC, Rabobank Nederland, New York Branch, Sumitomo Mitsui Banking Corp. and SunTrust Robinson Humphrey are the joint lead arrangers and joint bookrunners.

Bank of America, NA is the syndication agent.

Some proceeds were used to repay loans outstanding under existing credit agreements and other indebtedness of the company’s subsidiaries and to pay fees related to the credit agreement. Additional proceeds may be used to for working capital and other general corporate purposes.

The $600 million seven-year term loan was entered into by WestRock Co. subsidiaries RockTenn CP, LLC, Rock-Tenn Converting Co. and MeadWestvaco Virginia Corp. to support investments that allow existing mills to utilize waste and waste product or generate electric power from renewable energy sources.

Initial interest on that term loan is at Libor plus 150 bps. Interest will range from Libor plus 150 bps to Libor plus 212.5 bps, based on leverage or credit ratings.

CoBank ACB is the administrative agent, lead arranger and bookrunner in that loan.

After closing on the new loans, RockTenn terminated all outstanding commitments and repaid all outstanding loans under and terminated its credit agreement dated May 27, 2011.

Formed after a merger between MeadWestvaco Corp. and Rock-Tenn Co., WestRock is a packaging company based in Richmond, Va.

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