Severstal Closes USD 475 mln Senior Unsecured Convertible Bonds
OREANDA-NEWS. September 25, 2012. Severstal ("Severstal", the "Company") (LSE: SVST; MICEX-RTS: CHMF) is pleased to announce the closing of USD 475 million principal amount of senior unsecured convertible bonds due 24 September 2017 (the "Bonds") which are convertible into Global Depositary Receipts ("GDRs") listed on the London Stock Exchange, each representing one ordinary share of Severstal (the "Offering"). The Bonds have been issued by Holdgrove Limited (the “Issuer”) and guaranteed by Severstal (the “Guarantor”).
The net proceeds from the Offering will be used by companies within the Severstal group primarily for the refinancing of their existing indebtedness and for general corporate purposes.
The Bonds bear a coupon of 1.00 per cent per annum payable semi-annually in arrear, and a yield to maturity of 2.00% per cent per annum. The conversion price was set at USD 19.08, a premium of 45 per cent above the reference price of USD 13.1580. The conversion price of the Bonds is subject to standard convertible market anti-dilution adjustments.
The Bonds have been issued at 100 per cent of their principal amount and, unless previously redeemed, converted or cancelled, will mature on 24 September 2017 at the accreted redemption price of 105.231 per cent of their principal amount. The Issuer will have the option to redeem all of the Bonds at any time after 15 October 2015 at the accreted principal amount at such time together with accrued interest, if the value of the GDRs deliverable on conversion of the Bonds exceeds 140 per cent of the accreted principal amount of the Bonds over a specified period. Holders of the Bonds will have the option to require an early redemption of their Bonds on 24th September 2015, at the accreted principal amount at such time plus accrued interest. Bondholders will have the right to convert their bonds into GDRs of Severstal at any point from 41 days after the issue date up to the close of business on the seventh dealing day prior to the final maturity date.
Severstal will make an application for the Bonds to be listed on the PSM segment of the London Stock Exchange. The Bonds will be offered and sold outside the United States in reliance on Regulation S of the US Securities Act 1933, as amended. Citigroup Global Markets Limited and Deutsche Bank AG, London Branch have acted as Joint Bookrunners and Joint Lead Managers in connection with the Offering.
About OAO Severstal (LSE: SVST; MICEX-RTS: CHMF): ОАО Severstal is one of the world’s leading vertically integrated steel and steel related mining companies, with assets in Russia, the USA, the Ukraine, Latvia, Poland, Italy, Liberia and Brazil. Severstal’s ordinary shares are listed on MICEX-RTS and the company’s GDRs are traded on the LSE. Severstal reported revenue of USD 7,397 million and EBITDA of USD 1,226 million for H1 2012 and USD 15,812 million and USD 3,584 million for FY 2011 respectively and a net profit of USD 2,035 million for FY2011 and of USD 582 million for H1 2012. Severstal’s crude steel production in 2011 reached 15.3 million tonnes.
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