11/11/2013 - 07:54

FMG debt margin lowered

11/11/2013 - 07:54

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Fortescue Metals Group announced that lead arrangers Credit Suisse and JP Morgan have successfully completed an amendment and repricing process for its senior secured debt facility.

Fortescue Metals Group announced that lead arrangers Credit Suisse and JP Morgan have successfully completed an amendment and repricing process for its senior secured debt facility.

The repricing of the facility will reduce the margin of 4.25 per cent down to 3.25 per cent, extending the maturity to June 30, 2019. The initial decrease will further as FMG reduces leverage through debt reduction over time.

The 1 per cent reduction represents an annual interest saving of approximately $US50 million.

Fortescue's chief financial officer Stephen Pearce said "Fortescue has again received exceptionally strong support from the US debt capital markets. The amended terms of the facility reflect Fortescue's improving credit profile, with the ability to realise further savings in interest costs as leverage decreases through debt reduction and increased earnings."

He added "In the past 12 months Fortescue has consolidated its operational position, reduced production costs and continued to ramp up production as the 155mtpa expansion nears completion."

FMG maintained that the repricing will not affect its debt position and voluntary repayments will be able to be made.

FMG's share price rose 2 percent, up 11 cents, trading at $5.57 as of 745am, WST.

 

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