Cascades’ Greenpac Liner JV Successfully Refinances Debt
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Cascades Inc., Kingsey Falls, Que., Canada, a manufacturer of green packaging and tissue paper products, this week reported that the Greenpac Mill in Niagara Falls, N.Y., USA, a company created in partnership with the Caisse de dépôt et de placement du Québec, Jamestown Container, and Containerboard Partners, has successfully refinanced its bank debt.
The refinancing was completed with Wells Fargo, M&T Bank and Bank of America acting as co-lead arrangers and Export Development Canada as a member of the banking syndicate. The $245 million debt package includes a $195 million term loan and an authorized revolving credit facility of $50 million. The five-year agreement will allow the mill to reduce its financing costs by approximately 225 basis points.
"Today's announcement is excellent news, as it will give us increased flexibility to successfully address future market fluctuations, and will improve Greenpac's financial situation, considering that 65% of the term loan principal is payable at the end of the term only. In addition, the new conditions will remove certain constraints relating to the construction of the mill that had been included in the previous agreement negotiated in 2011. We would like to thank our financial partners for their ongoing support," said Cascades' CFO Allan Hogg.
Considered the most advanced facility of its kind in North America, the Greenpac Mill manufactures a lightweight linerboard, made with 100% recycled fibers, on a machine with an annual production capacity of 540,000 short tons. Built and operated by Norampac, a division of Cascades, the Greenpac Mill has 135 employees. Since the mill's startup in July 2013, demand for its innovative products has exceeded expectations. Thanks to a combination of the latest paper production technologies, Greenpac XP, a new type of recycled linerboard, sets itself apart with its superior strength and unparalleled print quality, while maintaining a lower basis weight than conventional linerboards.
