Photo by: Bloomberg
PERTH (miningweekly.com) – Australian iron-ore major Fortescue Metals has moved to further reduce its debt by repaying $1.6-billion of senior unsecured notes.
The two notes, which were due in 2015 and 2016 respectively, would be redeemed on March 14.
CEO Nev Power said on Wednesday that the voluntary redemption of the notes underscored the company’s commitments to repay the debt that funded the operational expansion to 155-million tonnes a year.
“This is a pivotal year for Fortescue as we near the completion of our expansion. The substantial increase in production and strong market conditions have strengthened our balance sheet and enabled us to accelerate our debt reduction programme.”
The repayment of the unsecured notes followed less than a month after the iron-ore miner repaid an initial $1-billion of the 2015 notes, and took the total debt repayments since November last year to $3.07-billion.
CFO Stephen Pearce noted that these measures continued to reduce Fortescue’s gearing towards 40%.
“We’ve taken another significant step in reducing Fortescue’s debt levels. The combination of voluntary debt repayments of $3.07-billion, in addition to successfully lowering the cost of remaining debt, presents an annual interest saving of more than $300-million,” Pearce said.