Fortescue works to clear debt
PERTH (miningweekly.com) – Iron-ore major Fortescue Metals on Wednesday launched a $750-million debt repayment offer for its 2019 and 2022 senior unsecured notes.
The company has offered to buy up to $750-million of its debt securities through a modified Dutch auction, and noteholders could tender their 2019 senior unsecured notes within a range of 88c and 93c per $1 of principal, and their 2022 notes within a range of 75c and 80c per $1.
CEO Nev Power said accelerating the company’s debt repayment programme through this tender process would further reduce its interest costs, while ensuring that Fortescue remained on track to achieve its initial gearing target of 40%.
“In line with our ongoing strategy to sustainably reduce our cost, this offer further improves Fortescue’s competitive position in the global iron-ore market.”
The offer, which was an important part in Fortescue’s long-term debt reduction strategy, would be finalised over the next few weeks.
Meanwhile, Power on Wednesday highlighted Fortescue’s achievements in reducing its costs through improved efficiency and competitiveness at the company’s annual general meeting, in Perth.
During the 2015 financial year, Fortescue shipped 165-million tonnes of ore. The miner was targeting $15/t C1 cash costs by the end of 2016.
“Fortescue is uniquely positioned to fully optimise the return from our world class assets located in Western Australia’s Pilbara region. We have completed our capital expansion and have the momentum in place to harness further efficiencies and drive optimisation across our whole business,” Power said.
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