Stockwatch – Company to issue $1-B senior unsecured notes aimed at collecting funds for existing debt repayment.
Stockwatch – Canadian miner Goldcorp Inc. (TSE:G, Mkt cap 20.41B, P/E – , Div/yield 0.05/2.61, EPS -3.82, Shares 813.19M) has kicked off a $1 billion issue of senior unsecured notes aimed at collecting funds for existing debt repayment, the company said in a statement.
The debt sale, which is expected to close on June 9, will consist of two securities worth $550 million and $450 million that will mature in 2021 and 2044, respectively. The shorter-term instrument will carry a coupon of 3.625% and the other facility will pay 5.45% interest.
Goldcorp hopes to reap $988 million in net proceeds from the offering. The money will be go towards the repayment of its $862.5 million convertible notes which fall due this August and its outstanding borrowings under a revolving credit facility.
The gold producer has hired HSBC Securities (USA) Inc and Morgan Stanley & Co LLC to book-run the offering. CIBC World Markets Corp, Scotia Capital (USA) Inc and RBC Capital Markets LLC will serve as passive book-running managers and Credit Suisse Securities (USA) LLC, Mitsubishi UFJ Securities (USA) Inc, RBS Securities Inc and SMBC Nikko Securities Inc will take part in the issue as co-managers.
The offering won a BBB rating from rating agency Fitch, which denotes low risk of default and an “adequate”, though “more likely” to be hurt by stressful events, debt servicing capacity. The agency also reiterated all other ratings of the company, including its issuer default rating of BBB.
Goldcorp’s ratings reflect its solid reserves, sound cost position and robust project pipeline. Its plan for significant development spending in the medium term is another factor benefiting the ratings, Fitch said.
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