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Sappi Limited - Press Release
Press Release
Embargoed/Not for release or distribution in the United States, Japan,
France, Canada or Australia
Johannesburg, 6 June 2002.
Sappi Subsidiary`s US Bond Issue 12 Times Oversubscribed
Sappi Limited, the leading global coated fine paper manufacturer, announced
today that the debut US dollar-denominated bond offering by its subsidiary,
Sappi Papier Holding AG ("SPH"), has been a resounding success.
The issue, which was launched as a US$ 500 million 10-year bond, was more
than 12 times oversubscribed. Because of the strong interest, the size was
increased to US$ 750 million and the term was extended by the addition of a
US$ 250 million 30-year tranche. The bonds were also priced tighter than
expected with fixed coupons of 6.75% for the 10-year tranche and 7.50% for
the 30-year tranche, equating to spreads of 175 and 195 basis points,
respectively, over the relevant US Treasury bonds.
The company`s timing was ideal as it was able to take advantage of base
rates near historic lows and the scarcity of publicly-traded debt from
corporate issuers with solid investment grade credit ratings. The proceeds
will be used to repay existing shorter-term debt, thereby improving the debt
maturity profile of the Group.
Sappi Executive Chairman Eugene van As said that he was delighted with
investors` interest in and enthusiasm for Sappi.
Donald Wilson, the Group`s Finance Director, said today that Sappi had
evaluated a number of financing instruments, ultimately preferring straight
debt to convertible bonds because it is less expensive and avoids diluting
shareholders in the future. He added that Sappi was particularly pleased
with the 10 year coupon which is as low as any achieved in the paper sector
recently.
Details of the bond issue are:
Issuer: Sappi Papier Holding AG
Guarantors: Sappi Limited and Sappi International S.A.
The Securities: US$500 million 6.75% Guaranteed Notes due 15 June 2012
US$250 million 7.50% Guaranteed Notes due 15 June 2032
Ratings: BBB (stable)/ Baa2 (stable) - S&P and Moody`s
Closing Date: The week of 10 June 2002
Interest Payments: 15 June and 15 December of each year, commencing 15
December 2002
Status: The Securities and the Guarantees will be direct,
unsecured and unsubordinated obligations of SPH, Sappi Limited and SISA,
respectively, ranking pari passu among themselves and with all other direct,
unsecured and unsubordinated obligations (except those obligations preferred
by statute or operation of law) of SPH, Sappi Limited and SISA,
respectively. The Securities and the Sappi Limited
Guarantee will, however, be effectively subordinated to any debt or other
obligations of any subsidiary of Sappi Limited (other than SPH and SISA)
with respect to the earnings and assets of that subsidiary
Denominations: US$1,000 and integral multiples of US$1,000
Listing: Luxembourg Stock Exchange pursuant to Rule 144A and
Regulation S
Governing Law: State of New York
Joint Lead Managers
and Bookrunners: J.P. Morgan Securities Inc. and Salomon Smith Barney
Inc.
Joint Lead Manager: Morgan Stanley & Co. Incorporated
end
Embargoed/ Not for release or distribution in the United States, Japan,
France, Canada or Australia
This announcement does not constitute an offer of securities for sale in the
United States. The securities referred to herein have not been and will not
be registered under the US Securities Act of 1933, as amended, and may not
be offered or sold in the United States absent registration or an exemption
from registration. The Company does not intend to conduct a public offering
of securities in the United States.
There shall not be any offer, solicitation or sale of these securities in
any jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of such
jurisdiction. Neither this announcement nor any copy hereof may be taken or
transmitted into the United States, Japan, France, Canada or Australia or
distributed directly or indirectly in the United States, Japan, France,
Canada or Australia.
Issued by: Sappi Limited
For further information:
Andre Oberholzer
Corporate Affairs & Communication Manager
Sappi Limited
Tel +27 (0) 11 407 8044
Fax +27 (0) 11 403 8236
Cel +27 (0) 82 906 0638
Andre.oberholzer@za.sappi.com
Date: 06/06/2002 10:05:00 AM Produced by the SENS Department
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