Mercer International sets talk for $500M of senior unsecured notes

Mercer International Inc. is circulating price talk for a $500 million offering of eight-year (non-call three) senior unsecured notes at 5.25%-5.50%, sources said. Books for the deal will close today at 2 p.m. ET. Final terms are expected thereafter via Credit Suisse (lead left), Barclays and RBC Capital Markets.

Proceeds from the new bonds will be used alongside cash on hand to refinance all the firm's outstanding 2024 senior notes and part of the outstanding 2025 notes. The borrower's 6.5% notes due 2024 were trading around 101.25 at the close yesterday, while the 7.375% notes due 2025 closed at 103.63.

The new issue is rated B+/Ba3.

Vancouver-based Mercer International is a manufacturer of northern bleached softwood kraft pulp in North America, Europe and Asia.