Cliffs offers new 7¾% notes due 2020 in exchange for four note series

By Susanna Moon

Chicago, Feb. 27 – Cliffs Natural Resources Inc. said it began private offers to exchange up to $750 million principal amount of its newly issued 7¾% senior secured notes due 2020 for four series of notes.

The company is offering to issue the new notes in exchange for each $1,000 principal amount of the following outstanding series of notes, listed in order of priority acceptance level:

• $754,138,000 6¼% senior notes due Oct. 1, 2040 with an offer sub-cap of $325 million and total exchange value of $780;

• $631,706,000 4 7/8% senior notes due April 1, 2021 with a total exchange value of $818.75;

• $446,226,000 4.8% senior notes due Oct. 1, 2020 with a total exchange value of $821.25; and

• $393.75 million 5.9% senior notes due March 15, 2020 with a total exchange value of $860.

The total exchange value includes an early tender premium of $50 per $1,000 principal amount of notes tendered for exchange by 5 p.m. ET on March 11, the early tender date.

Those who tender their notes for exchange after the early deadline will receive the total exchange value less the early premium.

The exchange offers will end at midnight ET on March 25.

Tendered notes may be withdrawn by the early tender deadline.

Holders also will receive cash for accrued interest to but excluding the settlement date.

The offers are conditioned on Cliffs having refinanced its revolving credit facility. The refinancing may consist of Cliffs issuing about $500 million principal amount of senior secured first-lien notes due 2020 and entering into the ABL facility for up to $550 million, according to a company press release.

The offers are not conditioned upon any minimum amount of notes being tendered.

BofA Merrill Lynch (888 292-0070 or 980 388-3646 collect), Jefferies, Deutsche Bank Securities and Credit Suisse are the dealer managers. Global Bondholder Services Corp. (866 470-4300 or 212 430-3774 collect for banks and brokers) is the information agent and depositary.

Cliffs is a Cleveland-based mining and natural resources company.

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