Cliffs Natural Resources Inc. Announces Termination with Respect to Tender Offers for Certain of Its Senior Notes

Dec 03, 2014, 23:02 ET from Cliffs Natural Resources Inc.

CLEVELAND, Dec. 3, 2014 /PRNewswire/ -- Cliffs Natural Resources Inc. (NYSE: CLF) announced today that it has terminated its previously announced cash tender offers (the "Tender Offers") for up to a maximum aggregate principal amount of its outstanding (i) 3.95% Senior Notes due 2018 (the "2018 Notes"), (ii) 5.90% Senior Notes due 2020 (the "March 2020 Notes"), (iii) 4.80% Senior Notes due 2020 (the "October 2020 Notes" and, together with the March 2020 Notes, the "2020 Notes"), (iv) 4.875% Senior Notes due 2021 (the "2021 Notes") and (v) 6.25% Senior Notes due 2040 (together with the 2018 Notes, the 2020 Notes and the 2021 Notes, the "Securities") that it can purchase for up to $600.0 million in cash, excluding accrued and unpaid interest.

The Tender Offers are being terminated because the Company's debt refinancing has been postponed due to perceived adverse market conditions.  As a result of the termination, none of the Securities that have been tendered in the Tender Offers will be accepted for purchase and no consideration will be paid or become payable to holders of Securities who have tendered their Securities in the Tender Offers. All Securities previously tendered and not withdrawn will be promptly returned or credited back to their respective holders.  

"With the unfavorable move in market rates during the past few weeks, the prudent decision is to postpone the company's refinancing plans until market conditions improve," said Cliffs' Chairman, President and CEO, Lourenco Goncalves. "Cliffs has ample liquidity and strong financial flexibility.  Accordingly, we will be patient and disciplined in assessing the capital markets. We appreciate the positive response received in our tender offers."

Additionally, the Company presently intends to keep its $1.125 billion multicurrency credit agreement in place.

Each Tender Offer was subject to the conditions set forth in the Offer to Purchase dated November 19, 2014 and the related Letter of Transmittal dated November 19, 2014. These conditions included, among others, the issuance of at least $1.1 billion in aggregate principal amount of senior secured debt securities that would mature prior to the 2020 Notes.  As of the early tender date and withdrawal deadline for the Tender Offers, which was 5:00 p.m., New York City time, on December 3, 2014, Securities had been validly tendered and not validly withdrawn with an aggregate purchase price in excess of the $600.0 million payment cap.

This press release confirms the formal termination of the Tender Offers. Cliffs reserves the right to initiate a new tender offer at a later date, but it is under no obligation to do so. Holders of Securities with questions regarding the termination of the Tender Offers may direct such questions to Global Bondholder Services Corporation at (866) 470-3700 (toll-free) or (212) 430-3774 (collect for banks and brokers).

This press release does not constitute an offer to purchase securities or a solicitation of an offer to sell any securities or an offer to sell or the solicitation of an offer to purchase any securities, nor does it constitute an offer or solicitation in any jurisdiction in which such offer or solicitation is unlawful. 

About Cliffs Natural Resources Inc.

Cliffs Natural Resources Inc. is a leading mining and natural resources company. Cliffs is a major iron ore producer in the Great Lakes region and a significant provider of high-and low-volatile metallurgical coal in the U.S. Additionally, Cliffs owns iron ore mines in Eastern Canada and operates an iron mining complex in Western Australia. Driven by the core values of social, environmental and capital stewardship, Cliffs' employees endeavor to provide all stakeholders operating and financial transparency. News releases and other information on Cliffs are available at: http://www.cliffsnaturalresources.com.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of the federal securities laws. Although Cliffs believes that these forward-looking statements and the underlying assumptions are reasonable, we cannot assure you that they will prove to be correct. Forward-looking statements involve a number of risks and uncertainties, and there are factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements. These risk factors include without limitation: our ability to successfully execute an exit option for the Bloom Lake mine that minimizes the cash outflows and associated liabilities of our Canadian operations; our  trends affecting our financial condition, results of operations or future prospects, particularly the continued volatility of iron ore and coal prices; our actual levels of capital spending; uncertainty or weaknesses in global economic conditions, including downward pressure on prices, reduced market demand and any slowing of the economic growth rate in China; availability of capital and our ability to maintain adequate liquidity and successfully implement our financing plans; our ability to successfully identify and consummate any strategic investments or capital projects and complete planned divestitures, including the sale of our Logan County Coal assets; our ability to cost-effectively achieve planned production rates or levels; changes in sales volume or mix; the outcome of any contractual disputes with our customers, joint venture partners or significant energy, material or service providers or any other litigation or arbitration; the impact of price-adjustment factors on our sales contracts; the ability of our customers and joint venture partners to meet their obligations to us on a timely basis or at all; our ability to reach agreement with our iron ore customers regarding any modifications to sales contract provisions or renewal of contracts; our actual economic iron ore and coal reserves or reductions in current mineral estimates, including whether any mineralized material qualifies as a reserve; the impact of our customers using other methods to produce steel or reducing their steel production; events or circumstances that could impair or adversely impact the viability of a mine and the carrying value of associated assets, as well as any resulting impairment charges; impacts of existing and increasing governmental regulation and related costs and liabilities, including failure to receive or maintain required operating and environmental permits, approvals, modifications or other authorization of, or from, any governmental or regulatory entity and costs related to implementing improvements to ensure compliance with regulatory changes; uncertainties associated with natural disasters, weather conditions, unanticipated geological conditions, supply or price of energy, equipment failures, and other unexpected events; adverse changes in currency values, currency exchange rates, interest rates and tax laws; our ability to maintain appropriate relations with unions and employees and enter into or renew collective bargaining agreements on satisfactory terms; risks related to international operations; the potential existence of significant deficiencies or material weakness in our internal controls over financial reporting; problems or uncertainties with leasehold interests, productivity, tons mined, transportation, mine-closure obligations, environmental liabilities, employee-benefit costs and other risks of the mining industry; and other factors and risks that are set forth in the Company's most recently filed reports with the U.S. Securities and Exchange Commission. The information contained herein speaks as of the date of this release and may be superseded by subsequent events. Except as may be required by applicable securities laws, we do not undertake any obligation to revise or update any forward-looking statements contained in this release.

SOURCE Cliffs Natural Resources Inc.



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