Freeport-McMoRan enters $3 billion five-year replacement revolver

By Marisa Wong

Los Angeles, Oct. 25 – Freeport-McMoRan Inc. and subsidiary PT Freeport Indonesia entered into a new revolving credit agreement on Oct. 19 for loans of up to $3 billion, according to an 8-K filed Tuesday with the Securities and Exchange Commission.

Freeport Indonesia’s borrowing capacity is limited to $500 million.

The facility is also available for the issuance of letters of credit up to $1.5 billion.

The revolver matures on Oct. 19, 2027.

Interest is equal to adjusted term SOFR plus a spread based on credit ratings. The spread ranges from 112.5 basis points to 175 bps.

The commitment fee, also based on ratings, ranges from 12.5 bps to 30 bps.

In addition, the revolver contains a financial covenant requiring the company to maintain a total leverage ratio not to exceed 3.75 to 1.00.

JPMorgan Chase Bank, NA is administrative agent, and Bank of America, NA is syndication agent. The joint lead arrangers and joint bookrunners are JPMorgan, BofA Securities, Inc., Citibank, NA, Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corp., Bank Of Nova Scotia, MUFG Bank, Ltd. and Bank Of Montreal, Chicago Branch.

As of Oct. 24, the company had no borrowings outstanding under the revolver and roughly $8 million of letters of credit issued.

The revolver replaces Freeport-McMoRan’s existing revolver dated April 20, 2018. The prior agreement was terminated effective Oct. 19.

Freeport-McMoRan is a Phoenix-based international mining company.

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