ArcelorMittal Sets Terms for $3 Billion Rights Issue --Update

By Alex MacDonald

LONDON--Steel giant ArcelorMittal (MT) on Friday outlined the terms of a $3 billion rights issue aimed at shoring up its finances while grappling with a global steel glut that pushed it to a $6.7 billion loss in the fourth quarter.

The world's largest steelmaker by output said it would issue 1.26 billion shares at EUR2.20 a share ($2.45) after shareholders on Thursday approved the company's plan to allow shareholders to buy seven new shares for every 10 they hold. The issue price represents a 35.3% discount to ArcelorMittal's theoretical ex-rights price, based on its closing Euronext Amsterdam share price on March 10.

ArcelorMittal plans to use the proceeds to reduce its debt and strengthen its balance sheet.

The Mittal family, which owns a 37.38% stake in the firm, said it has agreed to subscribe to its entitlement of the share issue, which would equate to roughly $1.1 billion.

The company and the Mittal family have agreed the issued shares won't be sold for a period of 180 days following the rights issue. Shareholders will have from March 15 up to March 30 to elect to take up their portion of the share issue.

T​he offering is underwritten by a syndicate of banks led by Goldman Sachs Group Inc., BofA Merrill Lynch and Crédit Agricole acting as joint global coordinators and joint bookrunners. Barclays, BNP Paribas, Citigroup, J.P. Morgan and Société Générale are also acting as joint bookrunners.

ArcelorMittal's shares were up 3.6% at EUR4.39 a share.

-Write to Alex MacDonald at [e-mail]

(END) Dow Jones Newswires

March 11, 2016 05:05 ET (10:05 GMT)

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