Sino-Forest announces pricing details of convertible note and common share
offerings

/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE U.S./

This news release is not an offer for sale of securities in the United States. The securities referred to herein have not been registered under the U.S. Securities Act of 1933, as amended, and may not be sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. The Company does not intend to register any part of the offering in the United States or to conduct a public offering of securities in the United States.

Nothing in this announcement constitutes an offer of securities for sale in any jurisdiction where it is unlawful to do so.

TORONTO, Dec. 11 /CNW/ - Sino-Forest Corporation (TSX: TRE) (the "Company" or "Sino-Forest") today announced the details of its convertible senior note offering and contemporaneous offering of common shares.

The Company has entered into a purchase agreement with Credit Suisse Securities (USA) LLC, BofA Merrill Lynch and TD Securities Inc. whereby the Company has agreed to sell and such initial purchasers have agreed to purchase, subject to customary conditions, US$400,000,000 principal amount of convertible senior notes due 2016, plus a 15% over-allotment option on a private placement basis in Canada, the United States and internationally pursuant to available exemptions. The notes shall bear interest at a rate of 4.25% per annum, payable semi-annually and shall mature on December 15, 2016. The notes will be convertible into common shares of the Company at an initial conversion rate of 47.2619 common shares per US$1,000 principal amount of notes (equivalent to an initial conversion price of approximately US$21.16 per share or approximately Cdn$22.26 per share based on a fixed exchange rate), subject to customary adjustments. Upon conversion, at the Company's election, the Company may deliver, in lieu of common shares, cash or a combination of cash and common shares.

The Company has also entered into an underwriting agreement with a syndicate of underwriters with Credit Suisse Securities (Canada), Inc. and TD Securities Inc., as joint bookrunners, and including Dundee Securities Corporation, RBC Dominion Securities Inc., Scotia Capital Inc., CIBC World Markets Inc., BofA Merrill Lynch, Canaccord Financial Ltd. and Maison Placements Canada Inc. Pursuant to the underwriting agreement and as described in the prospectus to be filed today in all provinces of Canada, the Company has agreed to sell and the underwriters have agreed to purchase, subject to customary conditions, 19,000,000 common shares at a price of Cdn$16.80 per share for aggregate gross proceeds of Cdn$319,200,000 plus a 15% over-allotment option. The common share offering is being made by way of a short form prospectus offering in all provinces of Canada and on a private placement basis in the United States and internationally pursuant to available exemptions.

As indicated in the Company's previous press release and as set out in greater detail in the prospectus relating to the common share offering and the offering memorandum relating to the note offering (each of which will be available on www.sedar.com), the net proceeds of the offerings are intended to be used by the Company to prepay the full amount of borrowings outstanding under the Company's syndicated term loan, as initial capital for the acquisition of commercial plantation forests in the Guizhou Province, PRC, to fund forestry investments in cooperation with state-owned plantation entities in the PRC, and any remainder, for any payments required to be made in connection with consummating the exchange for certain notes issued by Mandra Forestry Finance Limited ("Mandra Forestry") and warrants issued by Mandra Forestry Holdings Limited ("Mandra") and the acquisition of common shares of Mandra, for investments in Mandra Forestry as the Company may determine to make after it has consummated such exchange and acquisition, subject to definitive documentation and satisfaction of certain conditions, and for general corporate purposes.

It is expected that the closing of the note offering and the common share offering will both take place on or about Thursday, December 17, 2009. The Company has received conditional approval from the TSX for the listing of the common shares issuable on conversion of the notes and the common shares being issued as part of the common share offering, subject to the fulfillment of certain conditions by the Company.

The notes have been assigned an expected BB+ rating by Fitch Ratings and a proposed BB rating by Standard & Poor's.

About Sino-Forest Corporation

Sino-Forest Corporation is a leading commercial forest plantation operator in China. Its principal businesses include the ownership and management of forest plantation trees, the sale of standing timber and wood logs, and the complementary manufacturing of downstream engineered-wood products. The Company's common shares have traded on the Toronto Stock Exchange under the symbol TRE since 1995.

Please note: This press release contains projections and forward-looking statements regarding future events. Such forward-looking statements are not guarantees of future performance of the Company and are subject to risks and uncertainties that could cause actual results and company plans and objectives to differ materially from those expressed in the forward-looking statements. Such risks and uncertainties include, but not limited to, changes in China and international economies; changes in currency exchange rates; changes in worldwide demand for the Company's products; changes in worldwide production and production capacity in the forest products industry; competitive pricing pressures for the Company's products and changes in wood and timber costs.

This announcement is subject to offer and distribution restrictions in, among other countries, the United States, the People's Republic of China, Canada, the European Economic Area, France, Hong Kong, the United Kingdom and Singapore.

This announcement does not constitute an offer of securities for sale in any jurisdiction in or from which, or to any person to whom, it is unlawful to make such offer or invitation under applicable laws. The distribution of this announcement in certain jurisdictions may be restricted by law. Persons into whose possession this announcement comes are required by each of the Company, the initial purchasers and the underwriters to inform themselves about, and to observe, any such restrictions.

SOURCE Sino-Forest Corporation

For further information: For further information: SINO-FOREST CORPORATION, Toronto, Dave Horsley - Senior Vice President & Chief Financial Officer, Tel: (905) 281-8889, Email: davehorsley@sinoforest.com; Hong Kong, Louisa Wong - Senior Manager, Investor Communications & Relations, Tel: +852 2514 2109, Email: louisa-wong@sinoforest.com

Organization Profile

Sino-Forest Corporation

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890