By Cristal Cody
Prospect News, July 28 - Kruger Products LP sold an upsized C$175 million 8% senior notes due Aug. 9, 2018 (/B/DBRS: BB) at par on Thursday, according to an informed bond source.
The notes priced at a spread of 553.3 basis points over the Canadian bond curve.
The deal was upsized from C$150 million and priced in line with guidance.
Scotia Capital Inc. was the bookrunner. Co-managers were National Bank Financial Inc., RBC Capital Markets Corp., TD Securities Inc., Bank of America Merrill Lynch, CIBC World Markets Inc., Desjardins Securities Inc., HSBC Capital (Canada) Inc. and Laurentian Bank Securities, Inc.
The notes may be redeemed prior to Aug. 9, 2014 at 108%, on or after Aug. 9, 2015 at 104%, after 2016 at 102% and in 2017 and thereafter at par.
The deal has a 101% poison put.
The notes are guaranteed by Kruger Products (USA) Inc. and Grupo Tissue de Mexico, S de Rl de CV.
Proceeds will be used to refinance the company's syndicated credit facility and for general corporate purposes.
Kruger is Canada's leading tissue products producer, with brands that include Cashmere, Purex and Scotties. The company is a subsidiary of Montreal-based pulp and paper producer Kruger Inc.
| Issuer: | Kruger Products LP
|
| Guarantors: | Kruger Products (USA) Inc. and Grupo Tissue de Mexico, S de Rl de CV
|
| Amount: | C$175 million
|
| Maturity: | Aug. 9, 2018
|
| Securities: | Senior notes
|
| Bookrunner: | Scotia Capital Inc.
|
| Co-managers: | National Bank Financial Inc., RBC Capital Markets Corp., TD Securities Inc., Bank of America Merrill Lynch, CIBC World Markets Inc., Desjardins Securities Inc., HSBC Capital (Canada) Inc. and Laurentian Bank Securities, Inc.
|
| Coupon: | 8%
|
| Price: | Par
|
| Yield: | 8%
|
| Spread: | 553.3 bps over Canadian bond curve
|
| Call feature: | Prior to Aug. 9, 2014 at 108%, on or after Aug. 9, 2015 at 104%, after 2016 at 102% and 2017 and thereafter at 100%
|
| Put option: | 101%
|
| Pricing date: | July 28
|
| Settlement date: | Aug. 9
|
| Ratings: | Standard & Poor's: B
|
| DBRS: BB
|
| Distribution: | Canada
|
| Price talk: | 8%
|
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