Anglo American to buy back $1.95bn of its near-term bonds
The miner is using its strong cash holdings to strengthen its balance sheet, as promised
Anglo American will buy back up to $1.95bn of its near-term bonds, deploying its strong cash holdings to strengthen its balance sheet as CEO Mark Cutifani said it would do. A $1.2bn buy-back offer announced on Wednesday will close on March 14, with settlement on March 19. The offer extends to bonds due to expire in June 2019, April and November 2020 and April 2021. This comes after the February announcement that it would redeem a $750m US-denominated bond carrying an expensive 9.375% coupon and due in April 2019. It is likely Anglo will repeat its actions of 2017 when it bought back bonds and issued a longer-dated bond to pay for the exercise. It would be reasonable to expect Anglo to issue a new bond, extending its debt profile in line with comments from Stephen Pearce, Anglo’s financial director, about aligning the group’s debt profile with its assets and production profiles. Anglo repurchased $3.1bn of dollar, euro and sterling bonds during 2017 on top of $1.7bn worth of maturing...
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