International Paper Announces Pricing of Senior Notes Offering by Sylvamo Corporation

Rhea-AI Summary

International Paper Company (NYSE: IP) announced that its subsidiary, Sylvamo Corporation, priced $450 million of 7.000% senior unsecured notes due 2029. The offering is set to close on September 3, 2021. The proceeds, combined with anticipated borrowings and cash on hand exceeding $100 million, will be used for a special payment to International Paper ahead of the spin-off. These notes are offered privately, exempt from U.S. Securities Act registration requirements, and are available only to qualified buyers. Forward-looking statements indicate that the completion of the spin-off is still subject to SEC review.

Positive

• Sylvamo has priced $450 million of senior unsecured notes, indicating strong investor interest.
• The expected proceeds will facilitate a special payment to International Paper ahead of the spin-off.

Negative

• The completion of the spin-off is still subject to SEC review, introducing uncertainty.
• The offering is not registered under the Securities Act, potentially limiting investor access.

MEMPHIS, Tenn., Aug. 20, 2021 /PRNewswire/ -- International Paper Company (NYSE: IP) today announced that its wholly-owned subsidiary, Sylvamo Corporation ("Sylvamo"), has priced $450 million aggregate principal amount of 7.000% senior unsecured notes due 2029. The offering is expected to close on September 3, 2021, subject to customary closing conditions. The net proceeds from the offering of senior notes, together with anticipated borrowings under Sylvamo's expected credit facilities and cash on hand in excess of $100 million, will be used by Sylvamo to make a special payment to International Paper in advance of the spin-off.

The senior notes are being offered in a private offering exempt from the registration requirements of the United States Securities Act of 1933, as amended (the "Securities Act").  The senior notes are being offered only to qualified institutional buyers under Rule 144A and to non-U.S. persons outside the United States in reliance on Regulation S, each under the Securities Act.

The senior notes will not be and have not been registered under the Securities Act and may not be offered or sold within the United States absent registration or an applicable exemption from the registration requirements.

This announcement is not an offer to purchase, a solicitation of an offer to sell or purchase, or a solicitation of an offer to sell or purchase securities with respect to the senior notes and shall not constitute an offer, solicitation or sale in any state or jurisdiction in which, or to any person to whom such an offer, solicitation or sale would be unlawful. The offering of senior notes will be made only by the offering memorandum being sent to prospective investors.

Forward-Looking and Cautionary Statements

This press release may contain "forward-looking statements." Such forward-looking statements may include, without limitation, statements about the Company's market opportunities, strategies, competition and expected activities and expenditures, and at times may be identified by the use of words such as "may," "will," "could," "should," "would," "project," "believe," "anticipate," "expect," "plan," "estimate," "forecast," "potential," "intend," "continue" and variations of these words or comparable words. Forward-looking statements are based on current expectations and assumptions, and inherently involve risks and uncertainties. Accordingly, actual results may differ materially from those expressed or implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the differing materially from such forward looking statements are discussed in greater detail in International Paper's Securities and Exchange Commission ("SEC") filings and Sylvamo's registration statement on Form 10 filed with the SEC on August 9, 2021.  Neither International Paper nor Sylvamo can provide any assurance that the offering of senior notes will be consummated in the amount anticipated or at all or that the spin-off will be completed on the expected timeline or at all.  The completion of the spin-off remains subject to the ongoing SEC review process and satisfaction of customary closing conditions.  You should not place undue reliance on our forward-looking statements, which speak only as of the date of this press release. We undertake no obligation to make any revision to the forward-looking statements contained in this press release or to update them to reflect events or circumstances occurring after the date of this press release.

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SOURCE International Paper

FAQ

What is the purpose of the $450 million senior unsecured notes offering by International Paper's subsidiary Sylvamo?

The proceeds will be used for a special payment to International Paper before the spin-off.

When is the senior notes offering by Sylvamo expected to close?

The offering is expected to close on September 3, 2021.

What are the terms of the senior unsecured notes offered by Sylvamo?

The notes have a principal amount of $450 million and an interest rate of 7.000%, due in 2029.

Who are eligible buyers for the senior notes issued by Sylvamo?

The senior notes are offered only to qualified institutional buyers and non-U.S. persons outside the United States.

What risks are associated with the spin-off of Sylvamo from International Paper?

Completion of the spin-off is subject to SEC review and customary closing conditions, which introduce uncertainty.