ArcelorMittal looks to raise $3 billion from investors
16 March 2016
ArcelorMittal is raising $3 billion from investors to cut debt by selling new stock for $2.44 a share.
The Luxembourg-based steelmaker, the largest in the world in production, is offering shareholders seven new shares for every 10 they own at a 35 percent discount. The company wants to reduce the $15.7 billion it has in debt after losing nearly $8 billion last year, mostly because of declines in cash flow to its overseas mining operations because of the glut of cheap steel on the world market.
Chief Executive Officer Lakshmi Mittal and his family will retain a 37 percent holding in the company, which has facilities in East Chicago, Gary, Riverdale, Burns Harbor and New Carlisle. ArcerlorMittal employs nearly 10,000 workers in the region.
The company’s stock price has fallen by 55 percent as a result of the global import crisis that’s led to 12,000 steelworkers being laid off across the nation. ArcelorMittal first reported the debt reduction plan after it lost $6.7 billion in the fourth quarter.
Goldman Sachs, Bank of America, Merrill Lynch, Barclays, BNP Paribas, Citigroup, J.P. Morgan and Societe Generale Corporate & Investment Banking are backing and facilitating the sale of the additional stock.
ArcelorMittal is looking to take further steps to strengthen its balance sheet. The steelmaker has openly said it wants to shutter finishing lines at ArcelorMittal Indiana Harbor in East Chicago, though it has said it won’t close blast furnaces. Union officials have said such closures may be part of a new bargaining agreement but that no layoffs would take place.
Source : nwitimes.com