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SÃO PAULO, June 9, 2025 /PRNewswire/ — Brazilian steel giant Gerdau S.A. (NYSE: GGB) is making a bold move, announcing a cash tender offer for all outstanding 4.875% notes due in 2027, issued by Gerdau Trade Inc. The offer, fully and unconditionally guaranteed by Gerdau and its subsidiaries, aims to reshape its debt profile and potentially boost investor confidence.
This strategic maneuver, detailed in the offer to purchase dated June 3, 2025, allows Gerdau to proactively manage its debt obligations. The company, along with its guarantors, has set the stage for the purchase, which holds the potential to streamline their financial structure.
Here’s a snapshot of the offer’s key financial parameters, reflecting the current market sentiment as of this morning in New York City:
|
Title of Security |
CUSIP / ISIN |
Principal Amount Outstanding |
Reference U.S. Treasury Security |
Bloomberg Reference Page(1) |
Fixd Spread |
Reference Yield |
Consideration(2) |
|
4.875% Notes due 2027 |
G3925DAD2 / USG3925DAD24
37373WAD2 / US37373WAD20 |
$418,244,000.00 |
4.125% due 10/31/2027 |
FIT5 |
50 bps |
4.020 % |
$1,007.83 |
|
__________________ |
||
|
(1) |
The applicable page on Bloomberg from which the Dealer Managers will quote the bid side price of the Reference U.S. Treasury Security. |
|
|
(2) |
Per $1,000 principal amount of Notes validly tendered and accepted for purchase, based on the Fixed Spread (as defined in the Offer to Purchase) plus the yield calculated to the maturity date for the Notes, based on the bid-side price of the Reference U.S. Treasury Security (as defined in the Offer to Purchase) for the Notes as of 11:00 a.m. (New York City time) today. The Consideration does not include Accrued Interest (as defined in the Offer to Purchase) on the Notes, which will be payable in cash. |
|
The Fine Print on the Deal
Bondholders have until 5:00 p.m., New York time, today to participate in the tender offer, unless Gerdau Trade decides otherwise. The settlement date is tentatively set for June 12, 2025, giving investors a clear timeline to assess their options. Validly tendered notes can be withdrawn anytime prior to the expiration date. Holders whose notes are accepted will also receive accrued and unpaid interest.
The offer, however, is contingent on various factors, outlined in the offer to purchase. Gerdau Trade has the right to adjust the terms or even terminate the offer, depending on market conditions and adherence to specified stipulations.
In conclusion
This move by Gerdau underscores its commitment to sound financial management. By optimizing its debt, the company is aiming to enhance its stability and appeal to investors in the competitive global steel market.
For detailed information, investors are encouraged to consult the official Offer Documents.
This press release is for informational purposes only and does not constitute an offer to purchase or the solicitation of an offer to sell any securities.
Gerdau S.A.
Rafael Dorneles Japur
Vice-President and Investor Relations Officer
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