Cliffs Natural Resources States Public Offering Price

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Mining News Cliffs Natural Resources

Cliffs Natural ResourcesCLEVELAND, THUNDER BAY – Business – Cliffs Natural Resources Inc. has stated the pricing of its public offering of common and mandatory convertible preferred shares.

Cliffs Natural Resources

The Mandatory Convertible Preferred Shares will pay cumulative cash dividends when, as and if declared by the Company’s Board of Directors at an annual rate of 7.00% on the liquidation preference of $1,000 per Mandatory Convertible Preferred Share, quarterly on Feb. 1, May 1, Aug. 1, and Nov. 1 of each year, commencing on May 1, 2013 and to, and including, Feb. 1, 2016.

The Depositary Shares entitle the holders, through the bank depositary, to a proportional fractional interest in the rights and preferences of the Mandatory Convertible Preferred Shares underlying the Depositary Shares, including conversion, dividend, liquidation and voting rights, subject to certain limited exceptions. Unless converted earlier at the option of the holders, each Mandatory Convertible Preferred Share will automatically convert into between 28.1480 and 34.4840 Common Shares (and, correspondingly, each Depositary Share will automatically convert into between 0.7037 and 0.8621 Common Shares) on or around Feb. 1, 2016, subject to customary anti-dilution adjustments.

Cliffs Natural Resources intend to apply to list the Depositary Shares on the New York Stock Exchange under the symbol “CLV.” If the application is approved, the Company expects trading of the Depositary Shares on the New York Stock Exchange to commence within the 30-day period after the initial delivery of the Depositary Shares.

The Common Shares Offering and the Mandatory Convertible Preferred Shares Offering are expected to close on Feb. 21, 2013, subject to customary closing conditions.

Cliffs Natural Resources to use net proceeds

Cliffs Natural Resources intends to use the net proceeds from the Common Shares Offering and the Mandatory Convertible Preferred Shares Offering to repay borrowings outstanding under its term loan facility.  Any remaining net proceeds will be used for general corporate purposes.

J.P. Morgan and BofA Merrill Lynch are serving as joint book-running managers for the Common Shares Offering, and J.P. Morgan, BofA Merrill Lynch and Citigroup are serving as joint book-running managers for the Mandatory Convertible Preferred Shares Offering.

A registration statement relating to these securities has been filed with the U.S. Securities and Exchange Commission and is effective.  Each of the Common Shares Offering and the Mandatory Convertible Preferred Shares Offering may be made only by means of a prospectus supplement and an accompanying prospectus. A copy of the prospectus supplement and the accompanying prospectus relating to the Common Shares Offering or the Mandatory Convertible Preferred Shares Offering may be obtained by contacting:  J.P. Morgan Securities LLC, Attention: Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, New York 11717, or by calling 1-866-803-9204, or by contacting BofA Merrill Lynch, 222 Broadway, New York, NY 10038, Attn: Prospectus Department, email: dg.prospectus_requests@baml.com

Cliffs Natural Resources has agreed to sell 9,000,000 of its common shares, par value $0.125 per share (“Common Shares”) (or up to 10,350,000 Common Shares if the underwriters of such offering exercise their option to purchase additional Common Shares) (the “Common Shares Offering”), at $29.00 per Common Share, and 27,000,000 of its depositary shares (“Depositary Shares”), each representing a 1/40th interest in a share of its new 7.00% Series A Mandatory Convertible Preferred Stock, Class A, without par value (“Mandatory Convertible Preferred Shares”), $1,000 liquidation preference per Mandatory Convertible Preferred Share (equivalent to $25 per Depositary Share) (or up to 31,050,000 Depositary Shares if the underwriters of such offering exercise their over-allotment option in full) (the “Mandatory Convertible Preferred Shares Offering”), at $25 per Depositary Share, in separate registered public offerings.

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