United States Steel Announces Pricing on Senior Convertible Notes
OREANDA-NEWS. March 27, 2013. United States Steel Corporation (NYSE: X) announced that it has priced its public offerings of senior convertible notes and senior notes.
The Company announced the pricing of its public offering of USD 275 million aggregate principal amount of 2.75% Senior Convertible Notes due 2019 (the "Convertible Notes"). The Company has granted the underwriters a 30-day option to purchase up to an additional USD 41.25 million aggregate principal amount of the Convertible Notes on the same terms and conditions to cover over-allotments, if any.
The Convertible Notes will pay interest semi-annually in arrears on April 1 and October 1 of each year beginning October 1, 2013 at a rate of 2.75% per year, and will mature on April 1, 2019, unless earlier redeemed, repurchased or converted. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of the Company's common stock or a combination of cash and shares of the Company's common stock, at the Company's election.
The conversion rate will initially be 39.5491 shares of common stock per USD 1,000 principal amount of Convertible Notes (representing an initial conversion price of approximately USD 25.29 per share of common stock and a conversion premium of approximately 30% based on the closing price of USD 19.45 per share of the Company's common stock on March 20, 2013), subject to adjustment in certain circumstances. The offerings are expected to close on March 26, 2013, subject to customary closing conditions.
The Company also announced the pricing of its public offering of USD 275 million aggregate principal amount of 6.875% senior notes due 2021 (the "Senior Notes"). The Senior Notes were priced at 100% of the principal amount. The Senior Notes will pay interest semi-annually in arrears on April 1 and October 1 of each year beginning October 1, 2013, and will mature on April 1, 2021, unless earlier redeemed or repurchased.
The Company intends to use the net proceeds from the offerings for repurchases or repayment of indebtedness, focusing on near-term maturities, and any remaining proceeds for general corporate purposes.
J.P. Morgan Securities LLC, Barclays Capital Inc., Goldman, Sachs & Co., and Morgan Stanley & Co. LLC are the joint book-runners for these offerings.