AK Steel Announces Pricing of Secured Notes
OREANDA-NEWS. AK Steel Holding Corporation announced today that its subsidiary, AK Steel Corporation (“AK Steel”), has successfully priced its public offering (the “Offering”) of $380.0 million aggregate principal amount of 7.50% senior secured notes due 2023 (the “Secured Notes”). AK Steel will pay interest on the Secured Notes semi-annually on January 15 and July 15 of each year. Interest on the newly issued Secured Notes will accrue from June 20, 2016. The Secured Notes will mature on July 15, 2023. The Secured Notes will be fully and unconditionally guaranteed by AK Holding, AK Steel’s direct parent, and by AK Tube LLC and AK Steel Properties, Inc. (together with AK Tube LLC, the “Subsidiary Guarantors”), two wholly-owned subsidiaries of AK Steel. The Secured Notes will be secured by first priority liens on the plant, property and equipment (other than certain excluded property, and subject to permitted liens) of AK Steel and the Subsidiary Guarantors and any proceeds of the foregoing.
AK Steel intends to use the net proceeds of the Offering, together with cash on hand and/or borrowings under its revolving credit facility, to finance AK Steel’s previously announced cash tender offer for any and all of AK Steel’s outstanding 8.750% Senior Secured Notes due 2018 (“Old Notes”). If any Old Notes remain outstanding following the completion of the cash tender offer, AK Steel intends to promptly redeem such Old Notes in accordance with the terms of the Old Notes and the applicable indenture. The Offering is being made pursuant to an effective shelf registration statement on file with the Securities and Exchange Commission (the “SEC”) and is expected to close on June 20, 2016, subject to customary closing conditions.
The joint book-running managers for the Offering are BofA Merrill Lynch, Deutsche Bank Securities, J.P. Morgan, Wells Fargo Securities, Citigroup, Credit Suisse and Goldman, Sachs & Co.
AK Holding, along with certain of its subsidiaries, has filed a registration statement (including a prospectus) with the SEC relating to the Offering. Before you invest, you should read the prospectus supplement and accompanying prospectus in that registration statement and other documents AK Holding and AK Steel have filed with the SEC for more complete information about AK Holding, AK Steel and the Offering.
AK Steel is a world leader in the production of flat-rolled carbon, stainless and electrical steel products, primarily for automotive, infrastructure and manufacturing, construction and electrical power generation and distribution markets. Headquartered in West Chester, Ohio (Greater Cincinnati), the company employs approximately 8,500 men and women at eight steel plants, two coke plants and two tube manufacturing plants across six states: Indiana, Kentucky, Michigan, Ohio, Pennsylvania and West Virginia.
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