KapStone Completes Acquisition of U.S. Corrugated
Nov. 1, 2011 - KapStone Paper and Packaging yesterday said that it has completed the acquisition of U.S. Corrugated, Inc. (USC).
Under the terms of the sale, KapStone acquired USC, including a 240,000 ton recycled containerboard paper mill in Cowpens, SC and 14 converting facilities in the eastern and mid-western United States. USC has been successful in creating strong, long-term customer relationships resulting from outstanding service, quality and innovation.
"Today we are welcoming USC's team as the newest members of KapStone," stated Roger W. Stone, Chairman and Chief Executive Officer. "We look forward to building on their momentum. The acquisition of USC now transforms KapStone into a much more profitable and stronger company."
Funding for the acquisition came from cash on hand and borrowing under a new $525 million senior secured credit facility led by Bank of America Merrill Lynch and Barclays Capital. The new facility consists of a $375 million term loan maturing over five years and a $150 million revolving credit facility. At closing, KapStone's previously existing $101 million term loan was repaid. KapStone now has a $375 million 5 year term loan at an initial interest rate of 2.25%. The revolver was unused and is available for working capital requirements.
Headquartered in Northbrook, IL, KapStone Paper and Packaging Corporation is a leading North American producer of unbleached kraft paper products, linerboard and shipping containers. The Company is the parent company of KapStone Kraft Paper Corporation which includes paper mills in Roanoke Rapids, NC, North Charleston, SC, and Cowpens, SC, fourteen converting locations in the east and mid west, and a lumber mill in Summerville, SC. The business employs approximately 2,700 people.
SOURCE: KapStone Paper and Packaging Corp.