Allen & Overy Advises Fortescue Metals Group on USD2.3 Billion Bond Issue

Allen & Overy has acted as Australian counsel to Fortescue Metals Group in connection with its Rule 144A offering of USD2.3 billion of Senior Secured Notes due in 2022.

The Senior Secured Notes are senior secured obligations and will rank equally in right of payment with all existing and future senior unsubordinated indebtedness.

The proceeds of the issue, which completed on 27 April 2015, will be used by Fortescue to redeem outstanding 2017 and 2018 Senior Unsecured Notes, swap certain of the 2019 Senior Unsecured Notes for new Senior Secured Notes and to otherwise retire outstanding indebtedness maturing in 2019.

Commenting, Allen & Overy Perth-based partner Peter Wilkes said: “We are pleased to continue our long relationship with Fortescue Metals Group, having previously advised Fortescue on all of its funding transactions since 2006, including its USD5 billion senior secured term loan B facility. This transaction will strengthen Fortescue’s financial position by extending its debt maturity profile and provide the company with considerable flexibility in coming years. This bond issue also demonstrates a continuing willingness by US capital markets to support the Western Australian mining sector”.

Peter Wilkes led the Allen & Overy team from Perth, with support from senior associate Jonathan Siu and associate Matthew Del Rosso. Allen & Overy counsel Ka Sen Wong advised on the tax aspects of the transaction.

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