Gerdau Ameristeel Files Prospectus for Shares Offering
10/15/2007 - Gerdau Ameristeel files preliminary documents with relevant regulatory authorities in the U.S. and Canada for a proposed offering of 110 million of its common shares.
Gerdau Ameristeel Corp. has filed a preliminary short form prospectus with the securities regulatory authorities in each of the provinces and territories of Canada, and a registration statement on Form F-10 with the United States Securities and Exchange Commission (SEC), for a proposed offering of 110 million of its common shares in the United States and Canada.
Gerdau SA has agreed to purchase approximately 73 million of the common shares from Gerdau Ameristeel in the proposed offering. Gerdau currently owns approximately 66.5% of the outstanding common shares of Gerdau Ameristeel.
Common shares offered to the public will be sold in Canada and the United States. J.P. Morgan Securities Inc., CIBC World Markets Corp., ABN AMRO Rothschild LLC and HSBC Securities (USA) Inc. are acting as joint book-running managers and Banc of America Securities LLC and BMO Capital Markets are acting as co-managers (collectively, the underwriters) of the offering. Gerdau Ameristeel has granted the underwriters an option to purchase up to an additional 5,535,750 common shares at the public offering price, less underwriting commission, within 30 days following the closing date (the overallotment option).
Gerdau SA has agreed to purchase, within two days after the exercise of the overallotment option, a number of additional common shares to maintain its approximate 66.5% ownership interest, at the public offering price. The maximum aggregate number of additional common shares issuable to the underwriters and to Gerdau SA is 16.5 million. The final terms of this offering will be determined at the time of pricing.
The company says that it will use net proceeds from the offering to partially repay the loans incurred by Gerdau Ameristeel for its acquisition of Chaparral Steel, which closed on September 14, 2007.
Common shares may not yet be sold (nor may offers to buy be accepted) until the shelf registration statement becomes effective (U.S.) or until a receipt for a final prospectus has been obtained (Canada). The company notes that this announcement does not constitute an offer to sell or the solicitation of an offer to buy, and there shall be no sale of the common shares in any state, province, territory or jurisdiction in which such offer, solicitation or sale would be unlawful.
Gerdau Ameristeel is the second-largest minimill steel producer in North America with annual manufacturing capacity of approximately 11.7 million tons of mill finished steel products. Through its vertically integrated network of 19 minimills (including one 50%-owned joint venture minimill), 19 scrap-recycling facilities and 62 downstream operations, Gerdau Ameristeel serves customers throughout North America. The company's products are generally sold to steel service centers, steel fabricators, or directly to original equipment manufacturers for use in a wide variety of industries. Gerdau Ameristeel is approximately 66.5% owned by Gerdau SA.
Gerdau Group is the leader in the production of long steel products in the Americas and ranks as the 14th largest steelmaking company worldwide. It has approximately 35,000 employees and is present in thirteen countries: Argentina, Brazil, Canada, Chile, Colombia, Dominican Republic, India, Mexico, Peru, Spain, the United States, Uruguay and Venezuela. Gerdau Group has an annual installed capacity of more than 20 million metric tons of steel and is one of the largest recyclers in the Americas. With more than 100 years of history, it has taken a path of international growth in line with the steelmaking consolidation process.
