Fortescue raises US$1.5 billion notes
Australian iron ore producer Fortescue Metals Group Ltd (ASX: FMG) today priced its previously announced offering of senior unsecured notes.
The offering, which was upsized to $US1.5 billion ($A1.52 billion), is expected to settle on or about December 15, 2010, subject to customary closing conditions.
Fortescue said it intends to use the net proceeds from this offering for the expansion to 155 million tons per annum, approved by the its board on November 19 this year.
The US$1.5 billion of notes are in two tranches, with terms and conditions consistent with the unsecured notes issued in October 2010.
The first tranche of $US600 million was issued at 6.375 per cent per annum for five years.
The second tranche of $US900 million was issued at 6.875 per cent for seven years.
Fortescue also said it is permitted to incur indebtedness, in addition to the US$2.04bn refinance facility established in October 2010, of up to US$4.0 billion, which is not subject to any leverage test.
By 10:26 AEST, shares in the company have lifted seven cents or 1.07 per cent at $6.61.