Sherritt Reduces Debt by $120 Million through Dutch Auction on Debentures
TORONTO–(BUSINESS WIRE)–Sherritt International Corporation (TSX:S):
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES
Sherritt International Corporation (“Sherritt”) (TSX:S) today announced
the results of its modified Dutch auction tender offer to purchase for
cash its outstanding 8.0% Senior Unsecured Debentures due 2021, 7.5%
Senior Unsecured Debentures due in 2023 and 7.875% Senior Unsecured
Notes due in 2025 (collectively, the “Notes”). In accordance with the
terms of the Offers (collectively, the “Offers”), Sherritt has elected
to purchase an aggregate total of $121,223,000 principal amount of Notes
at an aggregate cost of $110,331,090 plus accrued interest.
“The successful conclusion of our Dutch auction completes the process
that we commenced with our unit offering principally aimed at
de-leveraging and strengthening our balance sheet,” said David Pathe,
President and CEO of Sherritt International. “Through this process, we
have reduced the principal amount outstanding of our Notes by more than
15%. This transaction saves the Company approximately $10 million
annually in interest expense, and brings the total amount of
indebtedness eliminated from our balance sheet over the past four years
to more than $2 billion.”
The following table sets out the Purchase Price, together with the
Clearing Price and Corresponding Principal, for each series of Notes to
be purchased under the Offers.
| Title of Security | CUSIP | Purchase Price |
Clearing |
Corresponding |
Outstanding Debentures |
|
8.00% Senior |
823901AH6 | $47,312,850 | $950 | $49,803,000 | $170,197,000 |
|
7.50% Senior |
823901AK9 | $39,286,380 | $890 | $44,142,000 | $205,858,000 |
|
7.875% Senior |
823901AL7 | $23,731,860 | $870 | $27,278,000 | $222,722,000 |
| Totals | $110,331,090 | N/A | $121,223,000 | $598.777,000 | |
The complete terms and conditions of the Offers to purchase each series
of Notes were set forth in the Offers to Purchase dated January 16,
2018. All Notes validly tendered at or below the Clearing Price will be
accepted for purchase by Sherritt subject to the conditions set forth in
the Offer to Purchase. Payment for Notes accepted for purchase will be
made by Sherritt on the settlement date, which is expected to be on or
about February 16, 2018.
Following the settlement of the Offers, any Notes that are purchased in
the Offers will be retired and cancelled and no longer remain
outstanding. All Notes not accepted for purchase by Sherritt will be
returned to the Tendering Holder. Following completion of the Offers,
Sherritt will have an aggregate total of $598,777,000 of Notes
outstanding.
National Bank Financial Markets acted as dealer manager for the Offers
and Computershare Investor Services Inc. is acting as depositary for the
Offers.
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.
About Sherritt
Sherritt is a world leader in the mining and refining of nickel and
cobalt from lateritic ores with projects and operations in Canada, Cuba
and Madagascar. The Corporation is the largest independent energy
producer in Cuba, with extensive oil and power operations across the
island. Sherritt licenses its proprietary technologies and provides
metallurgical services to mining and refining operations worldwide. The
Corporation’s common shares are listed on the Toronto Stock Exchange
under the symbol “S”.
Forward-Looking Statements
This press release contains certain forward-looking statements.
Forward-looking statements can generally be identified by the use of
statements that include such words as “believe”, “expect”, “anticipate”,
“intend”, “plan”, “forecast”, “likely”, “may”, “will”, “could”,
“should”, “suspect”, “outlook”, “projected”, “continue” or other similar
words or phrases.
Forward-looking statements are not based on historic facts, but rather
on current expectations, assumptions and projections about future
events, including matters relating to the transaction disclosed herein.
By their nature, forward-looking statements require the Corporation to
make assumptions and are subject to inherent risks and uncertainties.
There is significant risk that predictions, forecasts, conclusions or
projections will not prove to be accurate, that those assumptions may
not be correct and that actual results may differ materially from such
predictions, forecasts, conclusions or projections.
The Corporation cautions readers of this press release not to place
undue reliance on any forward-looking statement as a number of factors
could cause actual future results, conditions, actions or events to
differ materially from the targets, expectations, estimates or
intentions expressed in the forward-looking statements. These risks,
uncertainties and other factors include, but are not limited to the
risks and uncertainties set out in the Management’s Discussion &
Analysis of the Corporation for the period ending December 31, 2017 and
the Corporation’s Prospectus Supplement dated January 17, 2018, each of
which are available on SEDAR at www.sedar.com.
Readers are cautioned that the foregoing list of factors is not
exhaustive and should be considered in conjunction with the risk factors
described in this press release and in the Corporation’s other documents
filed with the Canadian securities authorities.
The Corporation may, from time to time, make oral forward-looking
statements. The Corporation advises that the above paragraph and the
risk factors described in this press release and in the Corporation’s
other documents filed with the Canadian securities authorities should be
read for a description of certain factors that could cause the actual
results of the Corporation to differ materially from those in the oral
forward-looking statements. The forward-looking information and
statements contained in this press release are made as of the date
hereof and the Corporation undertakes no obligation to update publicly
or revise any oral or written forward-looking information or statements,
whether as a result of new information, future events or otherwise,
except as required by applicable securities laws. The forward-looking
information and statements contained herein are expressly qualified in
their entirety by this cautionary statement.
Contacts
Sherritt International Corporation
Joe Racanelli, 416-935-2457
Director
of Investor Relations
Toll-Free: 1-800-704-6698
[email protected]
www.sherritt.com
