Novamerican Steel $325 million notes expected late September, early October

By Paul A. Harris

St. Louis, Aug. 21 - A $325 million offering of senior notes backing the acquisition of Novamerican Steel Inc. by Symmetry Holdings Inc. is expected to come to market in late September or early October pending market conditions, an informed source told Prospect News on Tuesday.

JP Morgan, CIBC World Markets and CIT Business Canada are providing $500 million of financing, which also includes a $175 million asset-based credit facility.

The bonds are backed by a bridge loan provided by JP Morgan and CIBC World markets, according to the source, who added that the loan will initially bear interest at Libor plus 450 basis points, with 50 bps step-ups every three months, to a cap of 11½%. The bridge loan matures in 2015.

Novamerican is a steel service center, processor and tubing manufacturer with headquarters in Lasalle, Quebec.

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