U.S. Steel Corp. on March 13 launched a cash tender offer to buy back its 8.375% senior secured notes due 2021.
The steel major has US$780 million of the 2021 notes outstanding. The company will pay US$1,078.46 per US$1,000 face value of the 2021 notes accepted for purchase.
The offer is expected to expire March 20 and is conditional upon the company successfully raising at least US$650 million through the issue of senior notes due 2026.
The net proceeds from the debt offer, together with cash on hand, will fund the cash tender offer.
J.P. Morgan, Bank of America Merrill Lynch, Barclays, Wells Fargo Securities, Credit Suisse, Citigroup, Goldman Sachs and Morgan Stanley are acting as joint book-running managers for the notes offering.
Following the U.S. government's announcement of tariffs on steel imports, the company expects to book EBITDA of about US$250 million in the first quarter, with 2018 EBITDA seen rising to about US$1.7 billion, up from the previous estimate of US$1.5 billion.
