Stmnt re Loan Facility

RNS Number:7972G
Sappi Ld
12 July 2001


Sappi raises Euro 900 million at Libor plus 0.55%

Sappi, the leading global coated fine paper manufacturer announced today that
it had successfully concluded a Euro 900 million syndicated loan facility
arranged and underwritten by three global banks, ABN AMRO, Citigroup and JP
Morgan.  The facility was raised through a wholly-owned European subsidiary
of the group and had originally been launched at Euro 800 million, but was
strongly supported by Sappi's relationship banks and subsequently increased
to Euro900 million.

Sappi Finance Director, Don Wilson, said today that the facility comprised
two tranches.  The first tranche is a Euro 562.5 million five-year revolving
credit facility for general corporate purposes, and the second a Euro 337.5
million term loan, which will be used to refinance existing high cost debt
in the United States.  Both tranches carry interest rates at Libor plus a
margin of 0.55%, the first tranche carries a floating utilisation fee of up
to 0.15% depending on usage.  Mr Wilson said that Sappi had some expensive
debentures in its North American subsidiary and had the opportunity to call
these debentures in December this year, which the group plans to do.  This
new facility will significantly reduce Sappi's borrowing cost in the USA and
should have a pre-tax cost reduction of approximately $13 million in a full
year.  The cash cost of calling the debentures will be approximately $6
million as a once off premium.

Mr Wilson said that the rate was very competitive and a reflection of Sappi's
credit standing in the international banking market.  The facility could be
drawn down in any currency of the Group's choice, and, therefore, there will
be great funding flexibility for its future needs.  Mr Wilson said the 0.25%
commitment fee payable on the unutilised portion of the facility was a
reasonable price to pay for access to low cost funds in the future to meet
whatever needs the Group might have.  He also added that there were no
immediate prospects for utilising the Euro 562.5 million tranche.

Issued by:

Brunswick South Africa
on behalf of Sappi Limited
Tel [phone]
Fax [phone]

For further information:

Don Wilson
Group Finance Director
Tel [phone]

NOTE TO EDITORS

Final Syndication Result
   Date: 12th July 2001                       
                                              
   Mandated Lead Arrangers                    
                                                        
1  ABN AMRO Bank                              54,625,000
2  Citibank                                   54,625,000
3  JP Morgan                                  54,625,000
                                                        
   Arrangers                                            
                                                        
4  Bank Austria Creditanstalt                 44,625,000
5  Bayerische Landesbank Girozentrale         44,625,000
6  BHF Bank AG                                44,625,000
7  BNP Paribas                                44,625,000
8  Commerzbank                                44,625,000
9  Credit Agricole Indosuez                   44,625,000
10 Erste Bank                                 44,625,000
11 KBC Bank NV                                44,625,000
12 National Westminster Bank                  44,625,000
13 RZB Austria                                44,625,000
14 Sumitomo Mitsui                            44,625,000
15 Wachovia Bank                              44,625,000
16 West LB                                    44,625,000
                                                        
   Co-Arrangers, Managers                               
                                                        
17 Banco Santander Central Hispano Benelux SA 10,000,000
18 Barclays Bank                              33,000,000
19 Dai-Ichi Kangyo / Mizuho Financial Group   20,000,000
20 DG Bank                                    33,000,000
21 Natexis Banques Populaires                 20,000,000
22 Societe Generale                           20,000,000
23 Standard Chartered Bank                    20,000,000