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RESOLUTE FOREST PRODUCTS INC.

(RFP)
  Report
Real-time Estimate Cboe BZX  -  12:01 2022-09-28 pm EDT
20.03 USD   +0.02%
09/27Resolute Forest Investor Alert By The Former Attorney General Of Louisiana : Kahn Swick & Foti, LLC Investigates Adequacy of Price and Process in Proposed Sale of Resolute Forest Products Inc. - RFP
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09/21Resolute to Hold a Special Meeting of Stockholders on October 31, 2022
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09/21Resolute Forest Products : Notice of Special Meeting of Stockholders
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Domtar Corporation entered into an agreement to acquire Resolute Forest Products Inc. (NYSE:RFP) from Fairfax Financial Holdings Limited (TSX:FFH) and others for $2.5 billion.

07/06/2022 EDT

Domtar Corporation entered into an agreement to acquire Resolute Forest Products Inc. (NYSE:RFP) from Fairfax Financial Holdings Limited (TSX:FFH) and others for $2.5 billion on July 5, 2022. The transaction will be carried out by way of a merger of Resolute with a newly created subsidiary of Domtar, providing for conversion of each share of Resolute common stock into the right to receive $20.50 per share, together with a CVR entitling the holder to a share of future softwood lumber duty deposit refunds. Each share, on a fully diluted basis at closing, will be entitled to receive one CVR. Domtar and certain of Domtar's subsidiaries have obtained debt financing commitments in an aggregate principal amount of up to $1.500 billion from (i) Barclays Bank PLC, Bank of Montreal, Wells Fargo Bank, Royal Bank of Canada and U.S. Bank and (ii) CoBank, ACB, together with certain of their affiliates (the “Debt Commitment Parties”) on the terms and subject to the conditions set forth in the debt commitment letters, the proceeds of which will be used by Domtar to consummate the merger, the other transactions contemplated by the merger agreement and such other uses as set forth in the debt commitment letters. The $1.500 billion in debt financing consists of (A) a $400 million seven-year senior secured bridge loan (the “Senior Secured Bridge”), (B) a $500 million seven-year farm credit system term loan (the “Term Loan”) and (C) $600 million in increased commitments under Domtar's existing $400 million asset-backed revolving loan facility that matures on November 30, 2026. Domtar has agreed to provide committed equity financing in an amount up to $500 million, the proceeds of which will be used by Domtar (i) to consummate the merger and the other transactions contemplated by the merger agreement. Resolute will become a wholly-owned subsidiary of Domtar, under the auspices of the Group, and continue to operate on a business-as-usual basis under the Resolute name. The Resolute management team will remain in place at the company's headquarters. Furthermore, The Paper Excellence Group plans to retain Resolute's production locations and levels of jobs. In case of termination, Resolute will be required to pay a termination fee of $40 million and Domtar will be required to pay a termination fee of $80 million.

Resolute stockholders will have the opportunity to vote on the transaction at a stockholders' meeting to be held in early fall. The merger will require the approval of a majority of the outstanding shares of Resolute. In addition to stockholder approval, the transaction is subject to applicable regulatory approvals and the satisfaction of certain other customary closing conditions including the waiting period expiration, clearance, approval or consent, as applicable, required under the competition laws of the United States, Canada and certain other jurisdictions, and the absence of certain legal impediments to the consummation of the Merger. The board of directors of Resolute unanimously determined that the terms of the transaction are fair to, and in the best interests of, Resolute and its stockholders and resolved to recommend that Resolute stockholders vote for the transaction. Fairfax Financial Holdings Limited, a significant stockholder of Resolute, has entered into a voting and support agreement to vote its shares in favor of the transaction. As of July 5, 2022, Fairfax Financial Holdings held approximately 30,548,190 shares, or 40% of the outstanding shares as of that date. The boards of directors of Domtar unanimously approved this Agreement. The transaction is expected to close in the first half of 2023.

Barclays is serving as exclusive financial advisor to Paper Excellence, and Robert M. Katz and Jason Morelli of Latham & Watkins LLP, McMillan LLP, and McCarthy Tétrault LLP, are serving as legal advisors. CIBC Capital Markets is serving as exclusive financial advisor to Resolute, and Steven J. Williams of Paul, Weiss, Rifkind, Wharton & Garrison LLP, and Stikeman Elliott LLP are serving as legal advisors. CIBC Capital Markets acted as fairness opinion provider to the board of Resolute. D.F. King & Co, Inc acted as information agent to Resolute. D.F. King & Co, Inc. will be paid approximately $24,500 and will be reimbursed for specified out-of-pocket expenses. Resolute has agreed to pay CIBCWM a fee, a significant portion of which is contingent upon the closing of the merger, of approximately $20 million. As compensation for CIBCWM rendering a financial opinion to the Board, Resolute paid CIBCWM a fee equal to $1.5 million, which will be credited against the CIBCWM transaction fee payable if the merger is consummated.


© S&P Capital IQ 2022
Stocks mentioned in the article
ChangeLast1st jan.
FAIRFAX FINANCIAL HOLDINGS LIMITED 1.25% 635.05 Delayed Quote.1.98%
RESOLUTE FOREST PRODUCTS INC. 0.07% 20.03 Delayed Quote.31.11%
All news about RESOLUTE FOREST PRODUCTS INC.
09/27Resolute Forest Investor Alert By Th : Kahn Swick & Foti, LLC Investigates Adequacy of Pri..
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09/21Resolute to Hold a Special Meeting of Stockholders on October 31, 2022
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09/21Resolute Forest Products : Notice of Special Meeting of Stockholders
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08/04Resolute Forest Products : Reports Second Quarter 2022 Results - Form 8-K
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08/04Earnings Flash (RFP.TO) RESOLUTE FOREST PRODUCTS Says Excluding special items, the comp..
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Financials (USD)
Sales 2022 3 791 M - -
Net income 2022 593 M - -
Net cash 2022 249 M - -
P/E ratio 2022 -
Yield 2022 -
Capitalization 1 538 M 1 538 M -
EV / Sales 2022 0,34x
EV / Sales 2023 0,29x
Nbr of Employees 6 900
Free-Float 62,8%
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Mean consensus HOLD
Number of Analysts 3
Last Close Price 20,02 $
Average target price 22,80 $
Spread / Average Target 13,9%
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Managers and Directors
Rémi G. Lalonde President, Chief Executive Officer & Director
Sylvain A. Girard Chief Financial Officer & Senior Vice President
Duncan K. Davies Non-Executive Chairman
Lori Kilgour Vice President-Operational Excellence
Alain Rhéaume Independent Director
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