Suzano Readies Convertible Domestic Bond

Brazilian pulp and paper company Suzano Celulose e Papel is planning to sell BRL1.2bn in 2013 convertible bonds in a private sale, it says. The deal is divided into a BRL401.8m convertible into preferred shares, and a BRL798.2m tranche convertible into common shares. Both pay interest at ICPA+ 4.5%, and are convertible after 2 years at a rate of BRL17.39. Proceeds will fund construction on a new unit at its industrial plant in the state of Maranhao. An investor relations official explains the debentures are to be offered to controlling shareholders, with BNDES agreeing to guarantee to buy up to BRL572m of the remainder. Suzano is rated Aa1/A+ on a national scale.