Freeport-McMoRan Copper & Gold (FCX-N) has sold US$500 million worth of convertible senior notes, US$150 more than originally planned. The notes come due February 2011.
Proceeds will be used to pay off all bank debt, for working capital and for general corporate purposes. The company also plans to terminate its existing bank credit facilities and replace them with a new one.
The convertible notes bear interest at a rate of 7% annually and are convertible into shares at US$30.87 apiece — a 70% premium over the US$18.16 per share closing price in New York on Feb. 5.
The New Orleans-based company also said that it will begin paying a US9-per-share quarterly dividend on May 1, its first since December 1998.
In January, Freeport-McMoRan sold US$500 million of seven-year notes yielding 10.125%.
Shares in Freeport-McMoRan were US$1.31 lower at $16.85 in late afternoon trade in New York on Feb. 6. The shares had slipped as slow as $16.76 earlier in the day.
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