IRVING, Texas, April 19, 2018 /PRNewswire/ -- Commercial
Metals Company (NYSE: CMC) ("CMC") announced today that it has
agreed to sell $350 million aggregate
principal amount of 5.750% Senior Notes due 2026 (the "Notes") in
an offering exempt from the registration requirements of the
Securities Act of 1933, as amended (the "Securities Act"). The
offering is expected to close on or about May 3, 2018, subject to customary closing
conditions.
The Notes will be CMC's senior unsecured obligations and will
rank equally with all of its existing and future senior unsecured
indebtedness. Interest on the Notes will be payable semiannually in
arrears on April 15 and October 15 of each year, beginning on
October 15, 2018. The Notes
will mature on April 15, 2026, unless
earlier repurchased or redeemed.
CMC intends to use the net proceeds from the offering to finance
a portion of the purchase price of its previously announced
acquisition of certain U.S. rebar steel mill and fabrication assets
from Gerdau S.A. (NYSE: GGB) (the "Business"). If the acquisition
of the Business does not close for any reason, CMC intends to use
the net proceeds of the offering for general corporate purposes. In
such event, CMC will also have the right, but not the obligation,
to redeem all of the Notes at a redemption price equal to 100% of
the initial offering price, plus accrued and unpaid interest, if
any, to, but excluding, the date of redemption.
There can be no assurance that the offering of the Notes will be
completed. The offering of the Notes is not contingent upon the
closing of the acquisition of the Business.
The Notes are being sold only to qualified institutional buyers
in the United States in accordance
with Rule 144A under the Securities Act and to persons outside
the United States in accordance
with Regulation S under the Securities Act. The Notes have not been
registered under the Securities Act and may not be offered or sold
in the United States without
registration or an applicable exemption from the registration
requirements of the Securities Act and applicable state or other
jurisdictions' securities laws. CMC intends to enter into a
registration rights agreement in connection with the Notes offering
pursuant to which CMC will file a registration statement covering
the future exchange or resale of the Notes.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy the Notes or any other securities,
nor shall there be any sale of the Notes or any other securities in
any state or jurisdiction in which such offer, solicitation or sale
would be unlawful. Any offer, if at all, will be made only pursuant
to Rule 144A or Regulation S under the Securities Act.
About Commercial Metals Company
Commercial Metals Company and its subsidiaries manufacture,
recycle and market steel and metal products, related materials and
services through a network of facilities that includes four
electric arc furnace ("EAF") mini mills, two EAF micro mills, a
rerolling mill, steel fabrication and processing plants,
construction-related product warehouses, and metal recycling
facilities in the United States
and Poland.
This news release contains forward-looking statements
regarding CMC's expectations concerning the offering of the
Notes. These forward-looking statements generally can be
identified by phrases such as we, CMC or its management "expects,"
"anticipates," "believes," "estimates," "intends," "plans to,"
"ought," "could," "will," "should," "likely," "appears,"
"potential," "outlook," or other similar words or phrases. There
are inherent risks and uncertainties in any forward-looking
statements. Although we believe that our expectations are
reasonable, we can give no assurance that these expectations will
prove to have been correct, and actual results may vary materially.
Except as required by law, CMC undertakes no obligation to update,
amend or clarify any forward-looking statements to reflect changed
assumptions, the occurrence of anticipated or unanticipated events,
new information or circumstances or otherwise.
Factors that could cause actual results to differ materially
from CMC's expectations include the following: changes in
economic conditions which affect demand for our products or
construction activity generally, and the impact of such changes on
the highly cyclical steel industry; rapid and significant changes
in the price of metals potentially impairing our inventory values
due to declines in commodity prices; excess capacity in our
industry, particularly in China,
and product availability from competing steel mills and other steel
suppliers including import quantities and pricing; compliance with
and changes in environmental laws and regulations, including
increased regulation associated with climate change and greenhouse
gas emissions; potential limitations in our or our customers'
abilities to access credit and non-compliance by our customers with
our contracts; financial covenants and restrictions on the
operation of our business contained in agreements governing our
debt; risks associated with acquisitions generally, such as the
inability to obtain, or delays in obtaining, required approvals
under applicable antitrust legislation and other regulatory and
third party consents and approvals; potential volatility in the
capital markets and its impact on the ability to complete the
proposed financing necessary to pay the purchase price for the
Business; failure to retain key management and employees of the
Business; issues or delays in the successful integration of the
Business' operations with those of the Company, including incurring
or experiencing unanticipated costs and/or delays or difficulties;
difficulties or delays in the successful transition of the Business
to the information technology systems of the Company as well as
risks associated with other integration or transition of the
operations, systems and personnel of the Business; future levels of
revenues being lower than expected and costs being higher than
expected; failure or inability to implement growth strategies in a
timely manner; unfavorable reaction to the acquisition of the
Business by customers, competitors, suppliers and employees;
currency fluctuations; global factors, including political
uncertainties and military conflicts; availability of electricity,
electrodes and natural gas for mill operations; information
technology interruptions and breaches in data security; ability to
hire and retain key executives and other employees; our ability to
make necessary capital expenditures; availability and pricing of
raw materials over which we exert little influence, including scrap
metal, energy, insurance and supply prices; unexpected equipment
failures; competition from other materials or from competitors that
have a lower cost structure or access to greater financial
resources; losses or limited potential gains due to hedging
transactions; litigation claims and settlements, court decisions,
regulatory rulings and legal compliance risks; risk of injury or
death to employees, customers or other visitors to our operations;
increased costs related to health care reform legislation; impacts
from the Tax Cuts and Jobs Act; and those factors listed under Item
1A. Risk Factors included in CMC's Annual Report filed on Form 10-K
for the fiscal year ended August 31,
2017 and any subsequently filed Quarterly Reports on Form
10-Q and Current Reports on Form 8-K.
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SOURCE Commercial Metals Company