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Transcontinental Announces $125 Million Note Offering in the United States

Press release from the issuing company

G.T.C. Transcontinental Group Ltd. announced today that it has signed an agreement to issue US$125 million Senior Unsecured Notes to institutional investors through a private placement in the United States. Banc of America Securities LLC acted as advisor and placement agent. Due to strong investor interest, Transcontinental opted to increase its initial offering from US$100 million to US$125 million. The Notes will be issued in two tranches. The first tranche of US$75 million will be repayable at maturity in December 2012 and will bear interest at the rate of 5.62%; the second tranche of US$50 million will also be repayable at maturity in December 2014 and will bear interest at the rate of 5.73%. "This is Transcontinental's first issue in the US market, and we're delighted with the reception we got, as it shows that institutional investors in the United States have confidence in Transcontinental's targeted growth strategy and prudent management," said Daniel Denault, Vice-President and Chief Financial Officer. "We also took advantage of the historically low interest rates to spread debt maturities over a longer time frame and reduce our exposure to interest rate fluctuations." Transcontinental plans to close the transaction and receive the net proceeds from the issue on or near December 18, 2002. Proceeds will be used first to reduce bank indebtedness in US dollars while providing Transcontinental with additional flexibility to support its strategic development through acquisitions in the United States.