Photo by: Duane Daws
South African paper and pulp producer Sappi announced on Friday that it had priced its bond offering to raise €450-million of new senior secured notes, due in 2022, with a coupon of 3.375% a year.
The net proceeds of the offering, together with drawings under credit facilities and cash on hand, would be used to redeem all of Sappi Papier Holding’s €250-million senior secured notes due in 2018 and $300-million senior secured notes due in 2019.
“We are delighted with the result of this refinancing and achieving this next step in our objective of reducing interest costs and extending our maturity profile. The material oversubscription indicates strong support from the bond investor community, resulting in a historically low coupon for Sappi of 3.375%. This refinancing also reduces our yearly interest charge by about $25-million,” said Sappi CEO Steve Binnie.