International Steel to repay bank debt with IPO

By Peter Heap

New York, July 31 - International Steel Group Inc. said it will repay bank debt with proceeds from its initial public offering of common stock.

The Cleveland steelmaker said its credit facilities require it to use all the money raised in the stock sale to repay its term loan A.

Half of any amount left after paying down the term loan A must be used to repay the term loan B.

International Steel said that the remaining 50% of proceeds left after retiring its term loan A will be used for general corporate purposes and to further reduce debt.

The planned IPO was disclosed in a registration statement with the Securities and Exchange Commission.

International Steel did not disclose the size of the offering.

Goldman, Sachs & Co. and UBS Securities LLC will be joint bookrunners.

International Steel Group was formed by WL Ross & Co. LLC to acquire and operate globally competitive steel facilities.

International Steel obtained its $1 billion credit facility (Ba2/BB+) as part of its purchase of the assets of Bethlehem Steel Corp. The facility consists of a $250 million two-year term loan A with an interest rate of Libor 325 basis points, a $400 million four-year term loan B with an interest rate of Libor plus 350 basis points and a $350 million three-year revolver with an interest rate of Libor plus 275 basis points. UBS Warburg, Goldman Sachs and CIT were the lead banks.

As of June 28, International Steel had $650 million outstanding on the facility.

© 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.