Wednesday, 20 Jul 2011 |Wall Street Journal
Fortescue Metals Group Ltd is considering AUD 1 billion bond issue as the iron ore miner plans to step up spending on its major expansion in Western Australia state.
Mr Neville Power CEO of Fortescue Metals Group said that the Australian miner will likely target US bond markets, but is also open to offers from Chinese banks as it looks to spend AUD 8.4 billion during the next two years to triple its production in the Pilbara region.
Mr. Power added that " "I would expect us to be back in the debt markets again, probably in the late third quarter, early fourth quarter, and I'd expect that it is likely to be a bond-raising this time,”
Macquarie Equities analysts said Monday that Fortescue might need to raise as much as $2 billion in external funding by the first half of next year to help pay for its expansion, despite strong cash flows due to current booming iron-ore prices.
Last week, the company revealed it had AUD 2.7 billion in cash on hand and had set up AUD 600 million revolving credit facilities with nine syndicate banks.
In May, Fortescue decided against proceeding with a proposed AUD 1 billion unsecured loan, stating that offers to provide the facility didn't meet its expectations.
Fortescue Metals Group Ltd is considering AUD 1 billion bond issue as the iron ore miner plans to step up spending on its major expansion in Western Australia state.
Mr Neville Power CEO of Fortescue Metals Group said that the Australian miner will likely target US bond markets, but is also open to offers from Chinese banks as it looks to spend AUD 8.4 billion during the next two years to triple its production in the Pilbara region.
Mr. Power added that " "I would expect us to be back in the debt markets again, probably in the late third quarter, early fourth quarter, and I'd expect that it is likely to be a bond-raising this time,”
Macquarie Equities analysts said Monday that Fortescue might need to raise as much as $2 billion in external funding by the first half of next year to help pay for its expansion, despite strong cash flows due to current booming iron-ore prices.
Last week, the company revealed it had AUD 2.7 billion in cash on hand and had set up AUD 600 million revolving credit facilities with nine syndicate banks.
In May, Fortescue decided against proceeding with a proposed AUD 1 billion unsecured loan, stating that offers to provide the facility didn't meet its expectations.
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