Cliffs gets new $550 million ABL revolver, repays old revolver

By Angela McDaniels

Tacoma, Wash., March 30 – Cliffs Natural Resources Inc. entered into a new $550 million senior secured asset-based revolving credit facility on Monday and repaid its former revolving credit facility, according to a company news release.

The company said it is no longer subject to the covenants associated with the former revolver such as interest coverage and secured debt-to-EBITDA tests.

The repayment was made with a portion of the proceeds of the company’s $540 million of new 8¼% senior secured notes due 2020. Proceeds will also be used for general corporate purposes.

The company also completed an exchange offer for four series of its notes. It accepted about $675 million principal amount of existing notes in exchange for about $544 million principal amount of newly issued 7¾% senior secured notes due 2020.

Through the refinancing transactions, the company was able to remove about $130 million of long-term debt from its balance sheet.

The company believes its new financing structure will give it “all the liquidity and financial flexibility” it needs to successfully complete its strategy, Lourenco Goncalves, chairman, president and chief executive officer, said in the news release.

Cliffs Natural Resources is a mining and natural resources company based in Cleveland.

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