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SAPPI LIMITED
PRESS RELEASE
12 JULY 2001
Sappi raises Euro900 million at Libor plus 0.55%
Sappi, the leading global coated fine paper manufacturer announced today
that it had successfully concluded a Euro900 million syndicated loan
facility arranged and underwritten by three global banks, ABN AMRO,
Citigroup and JP Morgan. The facility was raised through a wholly-owned
European subsidiary of the group and had originally been launched at Euro800
million, but was strongly supported by Sappi's relationship banks and
subsequently increased to Euro900 million.
Sappi Finance Director, Don Wilson, said today that the facility comprised
two tranches. The first tranche is a Euro562.5 million five-year revolving
credit facility for general corporate purposes, and the second a Euro337.5
million term loan, which will be used to refinance existing high cost debt
in the United States. Both tranches carry interest rates at Libor plus a
margin of 0.55%, the first tranche carries a floating utilization fee of up
to 0.15% depending on usage. Mr Wilson said that Sappi had some expensive
debentures in its North American Subsidiary and had the opportunity to call
these debentures in December this year, which the group plans to do. This
new facility will significantly reduce Sappi's borrowing cost in the USA and
should have a pre-tax cost reduction of approximately $13 million in a full
year. The cash cost of calling the debentures will be approximately $6
million as a once off premium.
Mr Wilson said that the rate was very competitive and a reflection of
Sappi's credit standing in the international banking market. The facility
could be drawn down in any currency of the Group's choice, and, therefore,
there will be great funding flexibility for its future needs. Mr Wilson said
the 0.25% commitment fee payable on the unutilized portion of the facility
was a reasonable price to pay for access to low cost funds in the future to
meet whatever needs the Group might have. He also added that there were no
immediate prospects for utilising the Euro562.5 million tranche.
Issued by:
Brunswick South Africa
On behalf of Sappi Limited
Tel +27 (0) 11 442 8803
Fax + 27 (0) 11 442 8838
For further information
Don Wilson
Group Finance Director
Tel + 27 (0) 11 407 8041
NOTE TO EDITORS
Final Syndication Result
Date: 12th July 2001
Mandated Lead Arrangers
1. ABN AMRO Bank 54,625,000
2. Citibank 54,625,000
3. JP Morgan 54,625,000
Arrangers
4. Bank Austria Creditanstalt 44,625,000
5. Bayerische Landesbank Girozentrale 44,625,000
6. BHF Bank AG 44,625,000
7. BNP Paribas 44,625,000
8. Commerzbank 44,625,000
9. Credit Agricole Indosuez 44,625,000
10. Erste Bank 44,625,000
11. KBC Bank NV 44,625,000
12. National Westminster Bank 44,625,000
13. RZB Austria 44,625,000
14. Sumitomo Mitsui 44,625,000
15. Wachovia Bank 44,625,000
16. West LB 44,625,000
Co-Arrangers, Managers
17. Banco Santander Central Hispano Benelux SA 10,000,000
18. Barclays Bank 33,000,000
19. Dai-Ichi Kangyo / Mizuho Financial Group 20,000,000
20. DG Bank 33,000,000
21. Natexis Banques Populaires 20,000,000
22. Societe Generale 20,000,000
23 Standard Bank Chartered Bank 20,000,00
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