Creamer Media Login

Copper giant Codelco raises $2bn in bond offering

6th September 2023

Font size: - +

SANTIAGO - Chile's Codelco raised $2-billion in a bond offering in New York on Tuesday, as the world's top copper producer seeks to fund an investment drive to revive flagging output.

The company offered 10-year and 30-year notes. The 10-year was for $1.3-billion with a yield of 5.966%, or 210 basis points over the comparable US Treasury rate.

The 30-year, meanwhile, was for $700-million with a yield of 6.331%, or a spread of 195 basis points.

The state-run miner is not only battling to reignite copper production, which is at its lowest level in 25 years, but is also facing calls to rein in its debt, which has ballooned as costs have overrun at some of its key mines in the Andean country.

"This financing seeks to ensure the availability of resources for the development of a demanding portfolio of investments that for this year will need a total of $4.1-billion," Codelco said in a statement.

"This magnitude of capital is consistent with the higher level of activity of the structural projects, which are resuming their construction pace and which will help increase the firm's production level to 1.7 million (metric) tons in 2030."

Late last month, rating agency Moody's said it was reviewing a possible ratings downgrade for Codelco amid weakened production, rising costs and growing financial pressure. It said the firm would need to lift its investments to about $4-billion from $3.3-billion to boost its "structural projects."

Banks BNP Paribas, Citi, J.P. Morgan, Santander and Scotiabank are the joint bookrunners on the offer, IFR said.

Codelco's production slipped last year to about 1.45-million metric tons, the lowest in around a quarter of a century, and output has slipped further this year with the miner expecting to produce between 1.31-million to 1.35-million metric tons of copper.

Edited by Reuters

Comments

The content you are trying to access is only available to subscribers.

If you are already a subscriber, you can Login Here.

If you are not a subscriber, you can subscribe now, by selecting one of the below options.

For more information or assistance, please contact us at subscriptions@creamermedia.co.za.

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

Click Here

MAGAZINE & ONLINE

➕

RESEARCH CHANNEL AFRICA

➕

CORPORATE PACKAGES

CLICK FOR A QUOTATION

➕