Cleveland Cliffs Inc (CLF)

[winchem21]

$400 million Secured Notes will bear interest at an annual rate of 4.875% and will be issued at a price of 99.347% of their principal amount. The offering is expected to close on December 19, 2017

Why is CLF moving so quickly on HBI funding that doesn’t ramp up until the latter half of 2018 according to last CC?
1. New tax law
2. Impending higher interest rates
3. Cleaner to go it alone for future M&A
4. Other...

http://www.clevelandcliffs.com/English/news-center/news-releases/news-releases-details/2017/Cleveland-Cliffs-Inc-Announces-Pricing-of-400000000-of-Senior-Secured-Notes-due-2024/default.aspx

December 05, 2017
Download this Press Release (PDF)
CLEVELAND--(BUSINESS WIRE)-- Cleveland-Cliffs Inc. (NYSE: CLF) (“Cliffs” or the “Company”) announced today that it has priced its previously announced private offering of $400.0 million aggregate principal amount of its senior secured notes due 2024 (the “Secured Notes”). The Secured Notes will bear interest at an annual rate of 4.875% and will be issued at a price of 99.347% of their principal amount. The offering is expected to close on December 19, 2017, subject to satisfaction of customary closing conditions.

The Secured Notes will be jointly and severally and fully and unconditionally guaranteed on a senior secured basis by substantially all of Cliffs’ material domestic subsidiaries and will be secured (subject in each case to certain exceptions and permitted liens) by (i) a first-priority lien on substantially all of Cliffs’ assets and the assets of the guarantors (other than accounts receivable and other rights to payment, inventory, as-extracted collateral, investment property, certain general intangibles and commercial tort claims, certain mobile equipment, commodities accounts, deposit accounts, securities accounts and other related assets and proceeds and products of each of the foregoing (collectively, the “ABL Collateral”)), and (ii) a second-priority lien on the ABL Collateral, which is junior to a first-priority lien for the benefit of the lenders under the Company’s senior secured asset-based credit facility.

The Company intends to use the net proceeds from the offering of the Secured Notes, along with the net proceeds from its previously announced concurrent convertible notes offering, to finance a substantial portion of its hot briquetted iron (“HBI”) capital project and for general corporate purposes.

The Secured Notes offering and the concurrent offering of convertible notes are not contingent upon one another.