SGF TO SELL ITS DOMTAR STAKE
February 4, 2003 By Pulp & Paper Canada
Quebec government’s investment agency, Socit Gnerale de Financement (SGF), has decided to sell its 16% Domtar st…
Quebec government’s investment agency, Socit Gnerale de Financement (SGF), has decided to sell its 16% Domtar stake.
The sale is valued at $618.7 million and proceeds will total $606.7 million after costs. Profit on the original investment will be $180 million.
SGF and Domtar made an agreement with an underwriting syndicate composed of National Back Financial, CIBC World Markets, Merrill Lynch Canada, and five other investment dealers. It will involve a public offering of 18.17 million shares at $16.50 each to be peddled immediately to outside investors. Buyers will simultaneously get a warrant valued at $1 (included in the $16.50 price) to buy a Domtar share during the following year for $17.55.
SGF has held Domtar for 21 years, beginning with a $145.8 million investment in 1981.
Domtar had revenues last year of $4.4 billion, and has 12,500 employees. Along with Cascades Inc., it owns Norampac – the largest producer of containerboard and corrugated board in Canada.
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