* Cliffs to raise funds to pay down debt
* Common shares priced at $29/shr, depositary shares at
* Miner reported Q4 loss after writedown of Canada deal
* Shares down 0.58 percent at $29.31 on NYSE
Feb 15 Cliffs Natural Resources Inc, a
U.S.-based coal and iron ore miner grappling with low
commodities pricing and escalating costs, could raise up to $1
billion through two separate equity offers announced earlier
this week and priced late on Thursday.
Shares of Cliffs plunged 18 percent on Wednesday, a day
after the company announced the share offering and slashed its
dividend. It also revealed quarterly loss after a writedown in
the value of a Canadian acquisition, higher costs and lower iron
Shares were down 0.58 percent at $29.31 shortly after market
open on Friday on the New York Stock Exchange.
The Cleveland-based miner said on Friday it planned to sell
some 9 million common shares at $29 each, lower than its
Thursday closing price of $29.48. If the offer is fully
exercised, Cliffs could sell up to 10.35 million shares, for
total proceeds of $300 million.
The company also plans to sell 27 million depositary shares
at $25 each. If fully exercised, Cliffs could sell up to 31.05
million of the securities for total proceeds of $776.3 million.
The depositary shares each represent a 1/40th interest in a
share of the company's new Series A mandatory convertible
Cliffs will list the depositary shares on the New York Stock
Exchange. If approved, trading could start within 30 days of
their initial delivery. The miner wants to use the proceeds of
the two offers to repay debt under its term loan facility and
for general corporate purposes.
In January, Cliffs said it would take a $1 billion charge
to write down the value of its C$4.07 billion ($4.06 billion)
takeover of Consolidated Thompson Iron Mines Ltd, a 2011 deal
that gave the company control of the Bloom Lake mine.
Bloom Lake is near the company's other Canadian operations
in the Labrador Trough, an iron-rich region that extends through
Quebec and Labrador.
On a conference call with analysts and investors on
Wednesday, Cliffs said Bloom Lake's revenue per tonne fell 26
percent to $89 in the fourth quarter.