Sherritt to pay cash for portion of 8% debentures due 2018, 7½% debentures due 2020

By Cristal Cody

Tupelo, Miss., Sept. 11 – Sherritt International Corp. (DBRS: BB) announced on Thursday offers to purchase for cash a portion of its outstanding debentures.

The company said it plans to buy C$100 million to C$150 million of its outstanding 8% senior debentures due Nov. 15, 2018 and C$200 million to C$250 million of its outstanding 7½% senior debentures due Sept. 24, 2020.

Sherritt sold C$400 million of the 8% debentures due 2018 at par to yield a spread of 605.3 basis points over the Government of Canada benchmark on Oct. 28, 2011.

The company sold C$500 million of the 7½% debentures due 2020 at par, or a spread of 579 bps over the Government of Canada benchmark, on Sept. 19, 2012.

Proceeds from the sale of Sherritt’s coal business on April 28 will be used to purchase the securities, reducing Sherritt’s total debt by up to C$400 million, according to the release.

In addition, subject to the completion of the offers and solicitations of consent, Sherritt said it plans to issue up to C$300 million of new debentures due 2022 to refinance the company’s outstanding 7¾% senior debentures due Oct. 15, 2015.

Toronto-based Sherritt is an energy and nickel mining and refining company.

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