Ferroglobe starts exchange offer, solicits consents for 9 3/8% notes due 2022

Chicago, June 24 – Ferroglobe plc launched an exchange offer and consent solicitation for its 9 3/8% senior notes due 2022, according to a press release.

The company is offering to exchange each $1,000 of old 9 3/8% notes originally issued by Ferroglobe and Globe Specialty Metals Inc. (Cusips: G33858AA2, 315419AA9) for $1,000 principal amount of new notes due 2025 to be issued by Ferroglobe, Globe and Ferroglobe Finance Co. plc plus a cash fee, which will be applied as a cash consideration for a subscription of new ordinary shares of Ferroglobe plc, the parent.

The equity fee will be an aggregate 1.75% of the ordinary shares of the parent after giving effect to the restructuring, to be allotted proportionally among the participating qualifying noteholders.

Additionally, Ferroglobe Finance is offering existing noteholders an opportunity to subscribe to an add-on to senior secured notes due 2025, of which $40 million of original notes were issued on May 17.

Consent solicitation

With the exchange offer, the issuers are soliciting consents to certain proposed amendments for the old notes.

The proposed amendments will eliminate substantially all of the restrictive covenants, all of the reporting covenants and certain of the events of default in the old notes indenture, if adopted.

The proposed amendments to the old notes will become effective upon execution of a supplemental indenture to the old notes indenture.

Tendering noteholders will be deemed to have given consent. Consents may not be delivered without tenders and vice versa.

New notes offer

Existing noteholders may wish to subscribe to an add-on offering of new super senior notes in a pro rata amount to their share of the old notes.

The 9% senior secured add-on notes due 2025 will be issued at par.

Interested noteholders must participate in the exchange offer and consent solicitation by July 7 and by no later than July 22 deposit the funds necessary for the proposed purchase of super senior notes to the escrow agent.

Background

The offers are the result of discussions with an ad hoc group that started in 2020.

The super senior notes offer and the equity placement are backstopped by the ad hoc group and Tyrus Capital, respectively.

Noteholders holding approximately 97% in aggregate principal amount of notes have signed the lock-up agreement to support the restructuring.

Conditions

The exchange offer is subject to the satisfaction or waiver of certain conditions, including the receipt of consents for at least 95.92%, or $335.72 million, of the old notes.

The conditions also include the receipt of at least $40 million in proceeds from the issuance and sale of new ordinary shares of the parent company to investors and the receipt of at least $20 million in proceeds from the super senior notes offer or from the backstop arrangement.

Details

The offer expires at 11:59 p.m. ET on July 21.

To reiterate, the deadline for the super senior notes offer is July 7.

Settlement is planned for July 29.

GLAS Trust Co. LLC is the information agent for the exchange offer (tes@glas.agency).

Ferroglobe is a London-based supplier of silicon metal, silicon-based specialty alloys and ferroalloys.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.