On December 12, Australian iron ore producer Fortescue Metals Group Ltd (Fortescue) priced its previously announced offering of senior unsecured notes. The offering, which was upsized to US$1.5 billion, is expected to settle on or about 15 December 2010, subject to customary closing conditions.
As SteelOrbis previously reported, on December 7, Fortescue announced that it launched a bond offering for US$800 million of senior unsecured notes in relation to the expansion funding of its two ports, three hubs strategy. The company extended the offering with its December 12 statement.
Fortescue said that it would need to raise an additional $US4 billion of debt to fund its iron ore mine and infrastructure expansions in Western Australia's Pilbara region to bring capacity to 155 million metric tons per annum by June 2014.
The US$1.5 billion of notes are in two tranches, US$600 million and US$900 million with interest rates of 6.375 percent per annum due February 1, 2016 and 6.875 percent per annum due February 1, 2018. The notes have the same terms and conditions consistent with the unsecured notes issued in October 2010.
JP Morgan was the sole bookrunner for the transaction.