Montreal, Quebec, Canada, 20 May 2009 -- /PRNewswire/ -- Domtar Corporation (NYSE/TSX: UFS) today announced that it is commencing a cash tender offer for up to CAD 250 million aggregate principal amount (the "Tender Cap") of its outstanding 7.875% Notes due 2011 (CUSIP # 257559AA2).
The tender offer is scheduled to expire at midnight, Eastern Time, on 16 June 2009 (the "Expiration Date"), unless extended or earlier terminated. The total consideration for each CAD 1000 principal amount of the Notes is CAD 1010 (the "Total Consideration"), which includes an early tender payment of CAD 10 per CAD 1000 principal amount of Notes (the "Early Tender Payment") and the Purchase Price (as defined below). The Early Tender Payment is payable only to holders of Notes who tender and validly deliver their Notes on or before 5:00 p.m., Eastern Time, on 01 June 2009 (the "Early Tender Time"), if such Notes are accepted for purchase by the company. Holders who tender their Notes after the Early Tender Time and on or before the Expiration Date will be entitled to receive CAD 1000 per CAD 1000 principal amount of the Notes (the "Purchase Price"), if such Notes are accepted for purchase by the company. Holders of Notes accepted for purchase by the company will also receive in addition to the Total Consideration or Purchase Price, as applicable, accrued and unpaid interest on any Notes so purchased from the last interest payment date to, but not including, the date on which the Notes are purchased. The company expects to accept the Notes for purchase promptly after the Expiration Date and expects that it will pay the Total Consideration or Purchase Price, as applicable, on the Notes on the business day following the date that the Notes are accepted. As of 19 May 2009, approximately CAD 540 million aggregate principal amount of the Notes were outstanding.
The company may increase or waive the Tender Cap at its sole discretion. If the aggregate principal amount of Notes validly tendered pursuant to the tender offer exceeds the Tender Cap, then, if the company accepts Notes for purchase, it will purchase such Notes on a pro rata basis among the tendering Holders of Notes, based on the aggregate principal amount of Notes tendered by each Holder. The company's obligation to consummate the tender offer is conditioned upon the satisfaction or waiver of certain conditions described in the Offer to Purchase (as defined below), including the company obtaining at least CAD 250 million in proceeds from an offering of debt securities, on terms and conditions reasonably satisfactory to the company, on or before the Expiration Date.
The complete terms and conditions of the tender offer are described in the Offer to Purchase, dated 19 May 2009, of the company (the "Offer to Purchase"). The company has engaged J.P. Morgan Securities Inc. and Morgan Stanley & Co. Incorporated to act as dealer managers in connection with the tender offer. Questions regarding the tender offer may be directed to J.P. Morgan at (212) 270-1477 (collect) or (800) 245-8812 (U.S. toll-free) or to Morgan Stanley at (212) 761-1941 (collect) or (800) 624-1808 (U.S. toll-free). Requests for documentation may be directed to Global Bondholder Services Corporation, the information agent and depositary for the tender offer, at (212) 430-3774 (for banks and brokers) or (866) 470-3700 (U.S. toll-free).
The tender offer is being made only by the Offer to Purchase, dated 19 May 2009, and the related letter of transmittal. The offer is not being made to noteholders in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky, or other laws of such jurisdiction. In any jurisdiction in which the offer is required to be made by a licensed broker or dealer, it shall be deemed to be made by the dealer managers on behalf of the company.
Domtar Corporation (NYSE/TSX:UFS) is the largest integrated manufacturer and marketer of uncoated freesheet paper in North America and the second largest in the world based on production capacity, and is also a manufacturer of papergrade, fluff, and specialty pulp. The company designs, manufactures, markets, and distributes a wide range of business, commercial printing, publication, converting, and specialty papers, part of a family of environmentally and socially responsible papers. Domtar owns and operates Domtar Distribution Group, an extensive network of strategically located paper distribution facilities. Domtar also produces lumber and other specialty and industrial wood products. The company employs nearly 11,000 people. To learn more, visit www.domtar.com.