Metinvest wraps offer for 10¼% notes, waives tender minimum condition

By Susanna Moon

Chicago, Nov. 25 – Metinvest BV said investors had tendered $386,349,000 of its $500 million of 10¼% guaranteed notes due May 20, 2015 by the end of the offer at 11:59 p.m. ET on Nov. 24.

The company waived the minimum tender condition with plans to settle the tendered notes on Nov. 28, according to a company news release.

After settlement, there will be $113,651,000 of the notes left outstanding.

As noted before, the offer had been conditioned on securing tenders for at least $450 million of the 10¼% notes.

The exchange offer began on Oct. 21.

The company extended the offer on Nov. 19 and said that it had received tenders for $380,247,000, or 76%, of the notes as of 11:59 p.m. ET on Nov. 18, the previous expiration date.

The company offered cash and 10½% guaranteed notes due Nov. 24, 2017 in exchange for the 10¼% notes.

The cash payment was increased to $250 per $1,000 principal amount of notes accepted for exchange from $200, and the exchange ratio was reduced to 75% from 80%. The issue price of the new notes remains par.

In addition, the terms of the new notes were amended to add restrictions on the ability of the issuer and/or its subsidiaries to make restricted payments during 2015 and 2016 and to specify that the new notes will be redeemed in four equal installment amounts beginning on May 24, 2016.

Holders who tendered by 5 p.m. ET on Oct. 31, the early deadline, were to receive an early instruction fee of $10.00 per $1,000 principal amount of notes tendered.

The issuer sought to reduce its debt service obligations due in 2015 and achieve a more efficient maturity profile.

Specifically, the company said it was making the exchange offer at this time in order to boost the amount of free cash available in 2015 as well as to preserve working capital to maintain production levels and the minimum level of investment needed to sustain its business.

Deutsche Bank AG, London Branch (+44 20 7545 8011) and ING Bank NV, London Branch (44 20 7767 5107) are the dealer managers. Bank of New York Mellon, London Branch (44 1202 689644 or debtrestructuring@bnymellon.com) is the exchange agent.

Metinvest is an integrated mining and steel business based in Donetsk, Ukraine.

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