PORTO ALEGRE, Brazil,
Oct. 4, 2017 /PRNewswire/ -- Gerdau
S.A. (Bovespa: GGBR, NYSE: GGB, Latibex: XGGB) ("Gerdau" or the
"Company"), Citigroup Global Markets Inc. and Santander Investment
Securities Inc. (collectively, the "Offerors" or "Dealer Managers")
today announced the commencement of an offer by the Offerors on
behalf of Gerdau to purchase for cash (the "Tender Offer") up
to a maximum amount of U.S.$500,000,000 (the "Aggregate Maximum
Tender Consideration") (including the Early Tender Payment, if
applicable) of the outstanding 7.000% Bonds due 2020 (the "2020
Bonds") issued by Gerdau Holdings Inc. (the "2020 Bonds Issuer"),
5.750% Bonds due 2021 (the "2021 Bonds") issued by Gerdau Trade
Inc. (the "2021 Bonds Issuer") and 5.893% Bonds due 2024 (the "2024
Bonds, and together with the 2020 Bonds and the 2021 Bonds, the
"Bonds" and each, a "series" of Bonds) issued jointly by Gerdau
Holdings Inc. and GTL Trade Finance Inc. (the "2024 Bonds Issuers",
and together with the 2020 Bonds Issuer and the 2021 Bonds Issuer,
the "Issuers").
The Tender Offer is being made pursuant to the offer to purchase
dated October 4, 2017 (the "Offer to
Purchase"). The principal purpose of the Tender Offer is for the
Issuers to manage their liabilities.
The table below summarizes certain payment terms for the Tender
Offer:
Description
of
Bonds
|
CUSIP /
ISIN Nos.
|
Outstanding
Principal
Amount
|
Tender Offer
Consideration
(1)(2)
|
Early Tender
Payment
(1)
|
Total
Consideration
(1)(2)
|
Tender
Cap
|
Acceptance
Priority
Level
|
5.750%
Bonds due
2021
|
G3925DAA8 /
USG3925DAA84
37373WAA8 / US37373WAA80
|
U.S.$1,250,000,000
|
U.S.$1,060.00
|
U.S.$30.00
|
U.S.$1,090.00
|
N/A
|
1
|
7.000%
Bonds due
2020
|
U37405AA2 /
USU37405AA20
37373UAA2 / US37373UAA25
|
U.S.$638,603,000
|
U.S.$1,066.25
|
U.S.$30.00
|
U.S.$1,096.25
|
N/A
|
2
|
5.893%
Bonds due
2024
|
G24422AA8 /
USG24422AA83
36249SAA1 / US36249SAA15
|
U.S.$1,165,629,000
|
U.S.$1,046.25
|
U.S.$30.00
|
U.S.$1,076.25
|
U.S.$75,000,000
|
3
|
(1) Per U.S. $1,000
principal amount of Bonds.
(2) Excludes accrued interest, which will be
paid in addition to the Tender Offer Consideration or the Total
Consideration, as applicable.
The Tender Offer will expire at 11:59
p.m. New York City time, on
November 1, 2017, unless extended or
earlier terminated (such date and time, including as extended or
earlier terminated, the "Expiration Date"). The early tender
deadline for the Tender Offer will be 5:00
p.m., New York City time,
on October 18, 2017 (such date and
time, including as extended or earlier terminated, the "Early
Tender Date"). Registered holders (each, a "Holder" and,
collectively, the "Holders") of the Bonds must validly tender their
Bonds at or before the Early Tender Date in order to be eligible to
receive the Early Tender Payment (as defined below) in addition to
the Tender Offer Consideration (as defined below). Bonds tendered
may be withdrawn prior to 5:00 p.m.,
New York City time, on
October 18, 2017 (such date and time,
the "Withdrawal Deadline"), but not thereafter, except as required
by applicable law.
The Bonds will be purchased in accordance with the "Acceptance
Priority Level" (in numerical priority order) as set forth in the
table above (the "Acceptance Priority Level"), with Acceptance
Priority Level 1 being the highest priority, and possible proration
of the Bonds on the Early Settlement Date (as defined below) or the
Final Settlement Date (as defined below) will be determined in
accordance with the terms of the Tender Offer. The 2024 Bonds
are subject to a limit of U.S.$75,000,000 on the aggregate total consideration
(including the Early Tender Payment, if applicable) of that series
that will be purchased in the Tender Offer (such aggregate total
consideration, subject to increase by the Offerors, the "2024
Tender Cap") Accordingly, 2021 Bonds validly tendered will be
accepted before any 2020 Bonds or 2024 Bonds validly tendered are
accepted, and 2020 Bonds validly tendered will be accepted before
any 2024 Bonds validly tendered are accepted. However, Bonds
validly tendered on or prior to the Early Tender Date will be
accepted for purchase in priority to other Bonds tendered after the
Early Tender Date, even if such Bonds tendered after the Early
Tender Date have a higher Acceptance Priority Level than Bonds
tendered on or prior to the Early Tender Date. If the aggregate
total consideration payable (including the Early Tender Payment, if
applicable) for the Bonds validly tendered exceeds the Aggregate
Maximum Tender Consideration and/or the 2024 Tender Cap (with
respect to the 2024 Bonds), only an amount of Bonds up to the
Aggregate Maximum Tender Consideration and/or the 2024 Tender Cap
(with respect to the 2024 Bonds) validly tendered will be accepted
for purchase. Accordingly, if the aggregate total consideration
payable for the Bonds validly tendered and not validly withdrawn on
or prior to the Early Tender Date exceeds the Aggregate Maximum
Tender Consideration, Holders who validly tender Bonds after the
Early Tender Date will not have any such Bonds accepted for payment
regardless of the Acceptance Priority Level of such Bonds.
If, on the Early Settlement Date or Final Settlement Date, as
applicable, only a portion of a series of Bonds may be accepted for
purchase, the aggregate principal amount of such series of Bonds
accepted for purchase will be prorated based upon the aggregate
principal amount of that series of Bonds that have been validly
tendered and not yet accepted for purchase in the Tender Offer,
such that the Aggregate Maximum Tender Consideration and the 2024
Tender Cap will not be exceeded.
The total consideration for the Bonds of each series (the "Total
Consideration") is: (i) U.S.$1,096.25
for each U.S.$1,000 principal amount
of the 2020 Bonds, (ii) U.S.$1,090.00
for each U.S.$1,000 principal amount
of the 2021 Bonds, and (iii) U.S.$1,076.25 for each U.S.$1,000 principal amount of the 2024 Bonds, which
includes, in each case, an early tender payment (the "Early Tender
Payment") of U.S.$30.00 per
U.S.$1,000 principal amount of the
Bonds, and in addition, in each case, the applicable Tender Offer
Consideration (as defined below). Subject to purchase in accordance
with the Acceptance Priority Level, the Aggregate Maximum
Consideration, the 2024 Tender Cap (with respect to the 2024 Bonds)
and possible proration, Holders validly tendering and not
withdrawing Bonds at or before the Early Tender Date will be
eligible to receive the Total Consideration (including the Early
Tender Payment) on a date promptly following the Early Tender Date
(the "Early Settlement Date") (which date is expected to be the
third business day after the Early Tender Date, but which may
change without notice).
Subject to purchase in accordance with the Acceptance Priority
Level, the Aggregate Maximum Consideration, the 2024 Tender Cap and
possible proration, Holders validly tendering their Bonds after the
Early Tender Date and prior to or at the Expiration Date will be
eligible to receive (the "Tender Offer Consideration"): (i)
U.S.$1,066.25 per U.S.$1,000 principal amount of the 2020 Bonds, (ii)
U.S.$1,060.00 per U.S.$1,000 principal amount of the 2021 Bonds and
(iii) U.S.$1,046.25 per
U.S.$1,000 principal amount of the
2024 Bonds, namely an amount, in each case, equal to the applicable
Total Consideration less the Early Tender Payment, on a date
promptly following the Expiration Date (the "Final Settlement
Date") (which date is expected to be the third business day after
the Expiration Date, but which may change without notice).
In addition, Holders whose Bonds are purchased in the Tender
Offer will receive accrued and unpaid interest in respect of their
purchased Bonds from the last interest payment date to, but not
including, (i) in the case of any Bonds tendered at or before the
Early Tender Date, the Early Settlement Date and (ii) in the case
of any remaining Bonds tendered after the Early Tender Date, the
Final Settlement Date, as the case may be.
The Issuers have consented to the Offerors making the Tender
Offer. It is intended that the Bonds validly tendered at or prior
to the Early Tender Date and purchased by the Offerors in the
Tender Offer will be exchanged by the Offerors with Gerdau Trade
Inc. for a decrease in the proceeds of certain new bonds to be
issued in a new offering proposed to be launched by Gerdau Trade
Inc. (the "New Offering").
The obligation of the Offerors to accept for purchase, and to
pay for, Bonds validly tendered pursuant to the Tender Offer is
subject to, and conditioned upon, the satisfaction or waiver of
certain conditions as set forth in the Offer to Purchase, in the
sole discretion of the Offerors, including pricing of the New
Offering in terms satisfactory to Gerdau Trade Inc. and the New
Offering being likely to close on the business day after the Early
Settlement Date.
The Information and Tender Agent for the Tender Offer is Global
Bondholder Services Corporation. To contact the Information and
Tender Agent, banks and brokers may call (212) 430-3774, and others
may call U.S. toll-free: (866) 470-4200.
The Dealer Managers for the Tender Offer are Citigroup Global
Markets Inc. and Santander Investment Securities Inc. Any questions
or requests for assistance may be directed to Citigroup Global
Markets Inc. at Collect: (212) 723-6106 or U.S. Toll-Free: (800)
558-3745 or Santander Investment Securities Inc. at Collect: (212)
940-1442 or U.S. Toll-Free: (855) 404-3636. In addition, Holders
may contact their broker, dealer, commercial bank, trust company or
other nominee for assistance concerning the Tender Offer.
This notice does not constitute or form part of any offer or
invitation to purchase, or any solicitation of any offer to sell,
the Bonds or any other securities in the
United States or any other country, nor shall it or any part
of it, or the fact of its release, form the basis of, or be relied
on or in connection with, any contract therefor. The Tender Offer
is made only by and pursuant to the terms of the Offer to Purchase
and the information in this notice is qualified by reference to the
Offer to Purchase. None of the Offerors, the Issuers or the
Information and Tender Agent make any recommendations as to whether
Holders should tender their Bonds pursuant to the Tender Offer.
This notice to the market does not represent an offer to sell
securities or a solicitation to buy securities in the United States or in any other country. The
New Offering was not and will not be registered under the U.S.
Securities Act of 1933 ("Securities Act"), as amended.
Consequently, the bonds issued in the New Offering are prohibited
from being offered or sold in the United
States or to U.S. citizens without the applicable
registration or exemption from registration required under the
Securities Act or applicable laws of other jurisdictions.
This notice to the market is released for disclosure purposes
only, in accordance with applicable legislation. It not does not
constitute marketing material, and should not be interpreted as
advertising an offer to sell or soliciting any offer to buy
securities issued by any of the Issuers. This notice to the market
is not for distribution in or into or to any person located or
resident in the United States, its
territories and possessions, any state of the United States or the District of Columbia or in any jurisdiction
where it is unlawful to release, publish or distribute this
announcement, other than any exemption thereunder.
Forward-Looking Statements
This notice includes and references "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements may relate to, among other things, the
Issuers' business strategy, goals and expectations concerning its
market position, future operations, margins and profitability.
Although the Issuers believe the assumptions upon which these
forward-looking statements are based are reasonable, any of these
assumptions could prove to be inaccurate and the forward-looking
statements based on these assumptions could be incorrect.
The matters discussed in these forward-looking statements are
subject to risks, uncertainties and other factors that could cause
actual results and trends to differ materially from those made,
projected, or implied in or by the forward-looking statements
depending on a variety of uncertainties or other factors.
The Issuers undertake no obligation to update any of their
forward-looking statements.
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SOURCE Gerdau S.A.