Teck Resources to use note offering proceeds to redeem 10.25% notes

By Tali David

Minneapolis, July 30 - Teck Resources Ltd. plans to use the proceeds from its $1.75 billion senior note offering to fund the redemption of all of its outstanding $659.5 million of 10.25% senior notes due 2016 and for general corporate purposes, including the retirement or redemption from time to time of additional debt, according to a press release.

The notes will be redeemed on Aug. 29, funded also with cash on hand.

Teck said it expects the additional debt to include all or a portion of its outstanding $200 million of 7% notes due September 2012 and all of its $521.3 million of 10.75% senior notes due 2019, which the company intends to redeem in the fourth quarter of 2012.

Net proceeds not used to retire or redeem debt may be used for other general corporate purposes, including capital expenditures, share repurchases or general working capital.

The Bank of New York Mellon Trust Co., NA is the trustee.

The company says it will record an estimated net after-tax accounting charge of about $202 million in the third quarter of 2012 in connection with the redemption of the10.25% notes.

Teck is a Vancouver, B.C.-based mining company with a focus on copper, steelmaking coal and zinc.

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