CLEVELAND, Feb. 9, 2017 /PRNewswire/ -- Cliffs
Natural Resources Inc. (NYSE: CLF) announced today the
commencement of tender offers to purchase (each offer a "Tender
Offer" and collectively, the "Tender Offers"), subject to certain
terms and conditions, up to the maximum aggregate principal amount
of its outstanding 5.90% Senior Notes due March 2020 (the "March
2020 Notes"), 4.80% Senior Notes due October 2020 (the "October
2020 Notes") and 4.875% Senior Notes due April 2021 (the "2021 Notes" and, collectively
with the March 2020 Notes and the
October 2020 Notes, the "Securities")
that it can purchase for up to $250.0
million in aggregate purchase price (the "Maximum Payment
Amount"), excluding accrued and unpaid interest up to, but not
including, the Settlement Date (as defined below), at the prices
set forth below.
The Tender Offers are scheduled to expire at midnight,
New York City time, at the end of
the day on March 9, 2017 (the
"Expiration Time"), unless extended or earlier terminated by the
Company. The Tender Offers are being made pursuant to an Offer to
Purchase and a related Letter of Transmittal each dated
February 9, 2017 (together, the
"Tender Offer Materials"), which set forth a more detailed
description of the Tender Offers. Holders of the Securities are
urged to carefully read the Tender Offer Materials before making
any decision with respect to the Tender Offers.
The Company is offering to purchase the maximum aggregate
principal amount of the Securities that may be purchased for the
Maximum Payment Amount, subject to the acceptance priority levels
set forth in the table below (the "Acceptance Priority
Levels"). As discussed in more detail in the Tender Offer
Materials, the Company reserves the right, but is under no
obligation, to increase or decrease the Maximum Payment Amount, at
any time, subject to compliance with applicable law.
The following table sets forth certain terms of the Tender
Offers:
Title of
Security
|
CUSIP Number
|
Principal
Amount
Outstanding
|
Acceptance Priority Level
|
Per $1,000
Principal
Amount of Securities Tender Offer Consideration(1)
|
|
5.90% Senior Notes
due 2020
|
18683K AA9
|
$225,643,000
|
1
|
$1,050.00
|
|
4.80% Senior Notes
due 2020
|
18683K AB7
|
$236,830,000
|
2
|
$1,010.00
|
|
4.875% Senior Notes
due 2021
|
18683K AD3
|
$309,437,000
|
3
|
$1,010.00
|
|
|
(1)
|
Excludes accrued and
unpaid interest up to, but not including, the Settlement Date,
which will be paid in addition to the Tender Offer
Consideration.
|
Subject to the terms and conditions of the Tender Offers,
holders of the Securities who validly tender their Securities prior
to the expiration of the Tender Offers will be eligible to receive
the tender offer consideration plus accrued and unpaid interest up
to, but not including, the Settlement Date, payable for each
$1,000 principal amount of Securities
specified in the table above for the applicable series of
Securities (the "Tender Offer Consideration"). Holders whose
Securities are accepted for purchase will also receive accrued and
unpaid interest up to, but not including, the Settlement Date.
The Company will purchase any Securities that are validly
tendered and not validly withdrawn prior to the Expiration Time, up
to the Maximum Payment Amount and subject to the satisfaction and
waiver of all conditions to the Tender Offers, promptly following
the Expiration Time (the "Settlement Date"). The Settlement Date
will occur promptly following the Expiration Time and is currently
expected to be on March 10, 2017,
assuming all conditions to the Tender Offers have been satisfied or
waived. The amounts of each series of Securities that are purchased
on the Settlement Date will be determined in accordance with the
Acceptance Priority Levels, with 1 being the highest Acceptance
Priority Level and 3 being the lowest Acceptance Priority
Level.
The Company currently intends to finance the purchase of
Securities tendered in the Tender Offers by issuing equity in an
amount and on terms satisfactory to the Company (the "Financing
Condition"). The obligation of the Company to accept for
purchase and to pay the Tender Offer Consideration and the accrued
and unpaid interest on the Securities pursuant to the Tender Offers
is not subject to any minimum tender condition, but is subject to
the Maximum Payment Amount, the application of the Acceptance
Priority Levels and the satisfaction or waiver of certain
conditions described in the Tender Offer Materials, including the
Financing Condition. The Tender Offers may be amended, extended,
terminated or withdrawn.
The Company has agreed, upon consummation of the Tender Offers,
to pay a soliciting dealer fee equal to $2.50 for each $1,000 principal amount of Securities that are
validly tendered pursuant to the Tender Offers to retail brokers
that are appropriately designated by their beneficial holder
clients to receive this fee, provided that such fee will only be
paid with respect to tenders by beneficial holders whose aggregate
principal amount of Securities is $250,000 or less.
The Company has retained BofA Merrill Lynch and Credit Suisse
Securities (USA) LLC to serve as
Dealer Managers for the Tender Offers. Global Bondholder Services
Corporation has been retained to serve as the Information Agent and
Depositary for the Tender Offers. Questions regarding the Tender
Offers may be directed to BofA Merrill Lynch at 214 North Tryon
Street, Charlotte, North Carolina
28255, Attn: Debt Advisory, (888) 292-0070 (toll-free), (980)
388-3646 (collect). Tender Offer Materials may be obtained by
calling Global Bondholder Services Corporation at (866) 470-4300
(toll-free) or (212) 430-3774 (collect for banks and brokers) or by
visiting www.gbsc-usa.com/cliffs.
The Company is making the Tender Offers only by, and pursuant
to, the terms of the Tender Offer Materials. None of the Company,
the Dealer Managers, the Information Agent and the Depositary make
any recommendation as to whether holders of the Securities should
tender or refrain from tendering their Securities. Holders of the
Securities must make their own decision as to whether to tender
Securities and, if so, the principal amount of the Securities to
tender. The Tender Offers are not being made to holders of
the Securities in any jurisdiction in which the making or
acceptance thereof would not be in compliance with the securities,
blue sky or other laws of such jurisdiction. In any
jurisdiction in which the securities laws or blue sky laws require
the Tender Offers to be made by a licensed broker or dealer, the
Tender Offers will be deemed to be made on behalf of the Company by
the Dealer Managers or one or more registered brokers or dealers
that are licensed under the laws of such jurisdiction.
This press release does not constitute an offer to purchase
securities or a solicitation of an offer to sell any securities or
an offer to sell or the solicitation of an offer to purchase any
securities nor does it constitute an offer or solicitation in any
jurisdiction in which such offer or solicitation is unlawful.
About Cliffs Natural Resources Inc.
Cliffs Natural
Resources Inc. is a leading mining and natural resources company.
Founded in 1847, Cliffs Natural Resources Inc. is recognized as the
largest and oldest independent iron ore mining 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. Driven by the core values of safety, social,
environmental and capital stewardship, Cliffs' employees endeavor
to provide all stakeholders operating and financial
transparency.
Forward-Looking Statements
This release contains statements that constitute
"forward-looking statements" within the meaning of the federal
securities laws. As a general matter, forward-looking
statements relate to anticipated trends and expectations rather
than historical matters. Forward-looking statements are
subject to uncertainties and factors relating to Cliffs' operations
and business environment that are difficult to predict and may be
beyond our control. Such uncertainties and factors may cause
actual results to differ materially from those expressed or implied
by the forward-looking statements. These statements speak
only as of the date of this release, and we undertake no ongoing
obligation, other than that imposed by law, to update these
statements. Uncertainties and risk factors that could affect
Cliffs' future performance and cause results to differ from the
forward-looking statements in this release include, but are not
limited to: uncertainty and weaknesses in global economic
conditions, including downward pressure on prices caused by
oversupply or imported products, the impact of any reduced barriers
to trade, the outcomes of recently filed and forthcoming trade
cases, reduced market demand and any change to the economic growth
rate in China; continued
volatility of iron ore and steel prices and other trends, including
the supply approach of the major iron ore producers, affecting our
financial condition, results of operations or future prospects,
specifically the impact of price-adjustment factors on our sales
contracts; our level of indebtedness could limit cash flow
available to fund working capital, capital expenditures,
acquisitions and other general corporate purposes or ongoing needs
of our business; availability of capital and our ability to
maintain adequate liquidity; our ability to successfully conclude
the Companies' Creditors Arrangement Act (Canada) process in a manner that minimizes
cash outflows and associated liabilities; the impact of our
customers reducing their steel production due to increased market
share of steel produced using other methods or lighter-weight steel
alternatives; uncertainty relating to restructurings in the steel
industry and/or affecting the steel industry; 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; problems or uncertainties with productivity, tons mined,
transportation, mine-closure obligations, environmental
liabilities, employee-benefit costs and other risks of the mining
industry; our ability to reach agreement with our customers
regarding any modifications to sales contract provisions, renewals
or new arrangements; our actual levels of capital spending; our
ability to successfully diversify our product mix and add new
customers beyond our traditional blast furnace clientele; our
actual economic iron ore reserves or reductions in current mineral
estimates, including whether any mineralized material qualifies as
a reserve; our ability to cost-effectively achieve planned
production rates or levels; our ability to successfully identify
and consummate any strategic investments or development projects;
changes in sales volume or mix; 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; our ability to maintain appropriate relations with unions
and employees; 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;
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; risks related to international operations; the
potential existence of significant deficiencies or material
weakness in our internal control over financial reporting; and our
ability to satisfy the Financing Condition and successfully
complete the Tender Offers. For additional factors affecting the
business of Cliffs, refer to Part I – Item 1A. Risk Factors of our
Annual Report on Form 10-K for the year ended December 31, 2016. You are urged to carefully
consider these risk factors.
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SOURCE Cliffs Natural Resources Inc.