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ArcelorMittal Prices Common Stock, Convertible Senior Note Offerings
04/30/2009 - ArcelorMittal has priced its common shares and convertible senior notes offerings, which represent total aggregate proceeds of approximately $3.5 billion before deduction of underwriting discounts and commissions.
ArcelorMittal announced that it has priced its common shares and convertible senior notes offerings. Total aggregate proceeds from the offerings are approximately $3.5 billion (exclusive of any proceeds attributable to the underwriters' possible exercise of their over-allotment options) or $4 billion (assuming full exercise of those options), in each case before deduction of underwriting discounts and commissions.
The company has agreed to sell 125,143,915 common shares at a public offering price of 17.10 EUR (US$22.77 at a $/EUR conversion rate of 1.3318) per common share. The company also granted the underwriters an option to purchase up to an additional 15,738,719 common shares in the 30-day period following the date hereof.
ArcelorMittal also announced the pricing of its public offering of $700 million aggregate principal amount of 5% convertible senior notes due May 15, 2014. The company granted the underwriters an option to purchase up to an additional $100 million aggregate principal amount of convertible senior notes in the 30-day period following the date hereof. Interest on the convertible senior notes will be paid semi-annually at a rate of 5% per year, and the convertible senior notes will mature on May 15, 2014, unless earlier repurchased or converted. The convertible senior notes will be convertible at the holder's option into shares of ArcelorMittal common stock (or, at the option of ArcelorMittal, into cash or a combination of cash or common stock) at an initial conversion ratio of 33.1675 shares of common stock per $1,000 principal amount of convertible senior notes, which is equivalent to an initial conversion price of approximately $30.15 per share of common stock, subject to adjustment in certain circumstances. This initial conversion price represents a premium of approximately 32.4% relative to the public offering price of ArcelorMittal's common stock of 17.10 EUR (US$22.77 at a $/EUR conversion rate of 1.3318) per share in the common stock offering.
The offerings are scheduled to close on May 6, 2009, subject to satisfaction of customary conditions. The closing of each offering is not contingent on the closing of the other.
ArcelorMittal said that it intends to use the proceeds of the common stock offering for general corporate purposes and to strengthen its balance sheet. It will use the proceeds of the convertible senior note offering to lengthen its debt maturity profile and refinance existing indebtedness under various revolving credit facilities, with maturities ranging from 2010 until 2012.
Goldman Sachs International is acting as Sole Global Coordinator and Bookrunner for the offerings.
CALYON and Société Générale Corporate & Investment Banking also are acting as Bookrunners. Morgan Stanley is acting as a Joint Bookrunner. BNP Paribas, ABN AMRO, HSBC Bank Plc, Citigroup and JPMorgan Chase are acting as Co-Bookrunners.
The Issuer has filed registration statements (each including a prospectus) with the Securities and Exchange Commission (SEC) for the announced offerings.
The company cautions that this announcement does not constitute an offer to sell or the solicitation of an offer to buy any shares of common stock, any convertible notes or any other securities. The company also noted that there will not be any sale of shares of common stock, of convertible notes or any other securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
ArcelorMittal is the world's largest steel company, with operations in more than 60 countries. The company leads major global steel markets, including automotive, construction, household appliances and packaging, with leading R&D and technology, as well as sizeable captive supplies of raw materials and outstanding distribution networks. With an industrial presence in over 20 countries spanning four continents, the company covers the key steel markets, from emerging to mature.
Through its core values of sustainability, quality and leadership, ArcelorMittal commits to operating in a responsible way with respect to the health, safety and wellbeing of its employees, contractors and the communities in which it operates. It is also committed to the sustainable management of the environment and of finite resources. Recognizing that it has a significant responsibility to tackle the global climate change challenge, ArcelorMittal takes a leading role in the industry's efforts to develop breakthrough steelmaking technologies and is actively researching and developing steel-based technologies and solutions that contribute to combat climate change.
In 2008, ArcelorMittal had revenues of $124.9 billion and crude steel production of 103.3 million tonnes, representing approximately 10% of world steel output.
