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Management Side
Technical Side
Votorantim Group Launches Tender Offer
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Sao Paulo, Brazil, 25 October 2006 -- /PRNewswire/ -- Voto-Votorantim Overseas Trading Operations III Ltd., a Cayman Islands limited liability company (Votorantim III), today announced that it launched a tender offer for any and all of its USD 300,000,000 7.875% Notes due 2014 (CUSIP nrs. 92908FAA4, G9393BAA2 and ISIN nrs. US92908FAA49, USG9393BAA29), guaranteed by Votorantim Participacoes S.A. (VPAR), Votorantim Celulose e Papel S.A., Votorantim Cimentos Brasil Ltda., Votorantim Metais Zinco S.A. and Votorantim Metais Niquel S.A. (Notes).

Votorantim III is a wholly-owned subsidiary of VPAR, which is the holding company for the Votorantim group, a Brazilian group that is a leader in the cement, pulp and paper, and metals and mining industries. The group is also actively engaged in the production of chemicals, frozen concentrated juice, energy, financial services, and venture capital.

The purpose of the tender offer is to manage the profile of the Votorantim group's outstanding consolidated indebtedness by reducing the amount of higher-coupon indebtedness.

The purchase price for each USD 1000 principal amount of Notes validly tendered and not validly withdrawn pursuant to the tender offer shall be equal -- as described in the Offer to Purchase dated 25 October 2006 -- to the sum of the present value on the settlement date for the tender offer of USD 1000 principal amount of the Notes and the present value of the interest payments due on such principal amount from the last interest payment date until the maturity date. The calculated amount willbe determined on the basis of a yield to the maturity date equal to the sum of (x) the bid-side yield (as quoted on Bloomberg PX1 on 31 October 2006, at 10:00 a.m. Eastern time) of the United States Treasury 4.875% Notes due 15 August 2016, plus (y) a fixed spread of 144 basis points (such price being rounded to the nearest cent) -- minus accrued and unpaid interest from the last interest from the last payment date to, but excluding, the settlement date, payable on the settlement date.

In addition, registered holders of Notes who validly tender and do not validly withdraw their Notes in the tender offer will also receive accrued and unpaid interest from the last interest payment date to, but excluding, the settlement date, payable on the settlement date.

J.P. Morgan Chase Bank, National Association has committed to make a bridge loan to an offshore affiliate of VPAR (guaranteed by VPAR) to enable the company to pay the purchase price and accrued interest in relation to tendered Notes. The bridge loan is expected to be drawn and funded on or before the settlement date for the tender offer and is subject to customary conditions precedent.

The tender offer will expire at 5:00 p.m., Eastern time, on 02 November 2006, unless earlier terminated or extended (such date and time, as they may be extended). Settlement of the tender offer is expected to occur on the third business day following the expiration date.

J.P. Morgan Securities Inc. is acting as dealer manager for the tender offer. Questions regarding the tender offer, including procedures for tendering Notes, may be directed to J.P. Morgan Securities Inc. at (212) 834- 7279 (collect) or (800) 846-2874 (toll free). Requests for documentation and questions regarding procedures for tendering Notes may be directed to D.F. King, Inc., the information agent, at (212) 269-5550 (collect) or (800) 290- 6429 (toll free).

Requests for documentation may also be made to Dexia Banque International a Luxembourg, as Luxembourg Agent, Transaction Execution Group, at + 352 4590 1 or fax: + 352 4590 4227.

Source: Votorantim Group


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