CLEVELAND, March 30, 2015 /PRNewswire/ -- Cliffs
Natural Resources Inc. (NYSE: CLF) ("Cliffs" or the "Company")
announced today that, on March 30,
2015, it entered into a new senior secured asset-based
revolving credit facility (the "New ABL Facility") and successfully
completed its previously announced private offering (the
"Offering") of $540 million aggregate
principal amount of 8.250% Senior Secured Notes due March 31, 2020 (the "New First Lien
Notes"). From the Offering of the New First Lien Notes, the
Company received net proceeds, after the initial purchasers'
discounts and the payment of fees and expenses, of approximately
$491.4 million. The Company used a
portion of the net proceeds from the Offering to repay all amounts
outstanding under its former revolving credit facility and intends
to use the remainder for general corporate purposes.
Additionally, the New ABL Facility is expected to provide up to
$550 million in borrowing
availability on a revolving basis, subject to a borrowing base
limitation and the issuance of letters of credit.
The Company also announced today that it has successfully
completed its previously announced private offers (the "Exchange
Offers") to exchange its newly issued 7.75% Senior Secured Notes
due 2020 (the "New Second Lien Notes") for certain outstanding
senior unsecured notes of Cliffs (the "Existing Notes"). The
Company has accepted for exchange approximately $675 million aggregate principal amount of
Existing Notes that were tendered in the Exchange Offers in
exchange for approximately $544
million aggregate principal amount of New Second Lien Notes.
The entry into the New ABL Facility, the Offering and the Exchange
Offers are referred to collectively as the "Refinancing
Transactions." The Company stated that with the new financing
structure, Cliffs is no longer subject to the covenants associated
with its former revolving credit facility, such as Interest
Coverage and Secured Debt-to-EBITDA tests. Also as a consequence of
the completion of the Exchange Offers, Cliffs was able to remove
approximately $130 million of
long-term debt from the balance sheet.
Lourenco Goncalves, Cliffs'
Chairman, President and Chief Executive Officer, stated, "We
believe that our new financing structure just put in place through
the completion of the Refinancing Transactions will give us all the
liquidity and financial flexibility we need to successfully
complete the strategy we have executed in a disciplined manner
since August 7, 2014, and which
differentiates Cliffs from any other iron ore producer in the
world. As the largest supplier of pellets in the U.S. and no longer
a major participant in the volatile seaborne market, we are very
pleased with the backing received from the investment community."
Mr. Goncalves added: "The success of our refinancing makes clear
that the investors understand and support our overall strategy, and
that Cliffs is better positioned than all other iron ore producers
in the world whose fundamentals are fully dependent on supplying
sinter feed to China."
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities. The New First Lien
Notes and related guarantees and the New Second Lien Notes and
related guarantees were offered only to qualified institutional
buyers in reliance on the exemption from registration set forth in
Rule 144A under the Securities Act of 1933 (the "Securities Act"),
and outside the United States to
non-U.S. persons in reliance on the exemption from registration set
forth in Regulation S under the Securities Act. The New First Lien
Notes and the related guarantees and the New Second Lien Notes and
related guarantees have not been and will not be registered under
the Securities Act, or the securities laws of any state or other
jurisdiction, and may not be offered or sold in the United States without registration or an
applicable exemption from the Securities Act and applicable state
securities or blue sky laws and foreign securities laws.
About Cliffs Natural Resources Inc.
Cliffs Natural
Resources Inc. is a leading mining and natural resources company in
the United States. The Company is
a major supplier of iron ore pellets to the North American steel
industry from its mines and pellet plants located in Michigan and Minnesota. Cliffs also operates an iron ore
mining complex in Western
Australia. Additionally, Cliffs produces low-volatile
metallurgical coal in the U.S. from its mines located in
Alabama and West Virginia. Driven by the core values of
safety, social, environmental and capital stewardship, Cliffs'
employees endeavor to provide all stakeholders operating and
financial transparency. News releases and other information on the
Company are available at:
http://www.cliffsnaturalresources.com.
Forward-Looking Statements
This release contains
forward-looking statements within the meaning of the federal
securities laws. Although Cliffs believes that these
forward-looking statements and the underlying assumptions are
reasonable, we cannot assure you that they will prove to be
correct. Forward-looking statements involve a number of risks and
uncertainties, and there are factors that could cause actual
results to differ materially from those expressed or implied in our
forward-looking statements. These risk factors include without
limitation: our ability to successfully execute an exit option for
our Bloom Lake mine that minimizes the cash outflows and associated
liabilities of our Canadian operations including the Companies'
Creditors Arrangement Act (Canada)
process; trends affecting our financial condition, results of
operations or future prospects, particularly the continued
volatility of iron ore and coal prices; our actual levels of
capital spending; availability of capital and our ability to
maintain adequate liquidity and successfully implement our
financing plans; uncertainty or weaknesses in global economic
conditions, including downward pressure on prices, reduced market
demand and any slowing of the economic growth rate in China; our ability to successfully identify
and consummate any strategic investments and complete planned
divestitures; the outcome of any contractual disputes with our
customers, joint venture partners or significant energy, material
or service providers or any other litigation or arbitration; the
ability of our customers and joint venture partners to meet their
obligations to us on a timely basis or at all; our ability to reach
agreement with our iron ore customers regarding any modifications
to sales contract provisions; the impact of price-adjustment
factors on our sales contracts; changes in sales volume or mix; our
actual economic iron ore and coal reserves or reductions in current
mineral estimates, including whether any mineralized material
qualifies as a reserve; the impact of our customers using other
methods to produce steel or reducing their steel production; events
or circumstances that could impair or adversely impact the
viability of a mine and the carrying value of associated assets, as
well as any resulting impairment charges; the results of
prefeasibility and feasibility studies in relation to projects;
impacts of existing and increasing governmental regulation and
related costs and liabilities, including failure to receive or
maintain required operating and environmental permits, approvals,
modifications or other authorization of, or from, any governmental
or regulatory entity and costs related to implementing improvements
to ensure compliance with regulatory changes; our ability to
cost-effectively achieve planned production rates or levels;
uncertainties associated with natural disasters, weather
conditions, unanticipated geological conditions, supply or price of
energy, equipment failures and other unexpected events; adverse
changes in currency values, currency exchange rates, interest rates
and tax laws; our ability to maintain appropriate relations with
unions and employees and enter into or renew collective bargaining
agreements on satisfactory terms; risks related to international
operations; availability of capital equipment and component parts;
the potential existence of significant deficiencies or material
weakness in our internal control over financial reporting; problems
or uncertainties with productivity, tons mined, transportation,
mine-closure obligations, environmental liabilities,
employee-benefit costs and other risks of the mining industry; and
other factors and risks that are set forth in the Company's most
recently filed reports with the U.S. Securities and Exchange
Commission. The information contained herein speaks as of the date
of this release and may be superseded by subsequent events. Except
as may be required by applicable securities laws, we do not
undertake any obligation to revise or update any forward-looking
statements contained in this release.
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SOURCE Cliffs Natural Resources Inc.