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Edgen Group Announces Pricing Of $540.0 Million Of Edgen Murray Corporation’s Senior Secured Notes

Stocks in this article: EDG

Edgen Group Inc. (“Edgen”) (NYSE:EDG) today announced that its indirect subsidiary, Edgen Murray Corporation (“EMC”) has priced its offering of $540 million aggregate principal amount of its 8.750% Senior Secured Notes due 2020 (the “Notes”) in a private offering. The Notes will be issued at 99.285% of face value and will mature on November 1, 2020. The offering is expected to close on October 16, 2012, subject to satisfaction of customary closing conditions.

The offering size has been reduced to $540 million from $575 million as Edgen has elected not to repay from the proceeds of the Notes offering an 8% note payable issued to the former owner of one of its predecessor companies as originally contemplated. Edgen will continue to focus on its goals of overall debt and interest cost reduction in a cost effective manner supported by cash flows from its normal course operations, availability under its credit facilities, or other financing options.

The terms of EMC’s new offering provide that the Notes and related guarantees will be secured on a first priority basis by substantially all of our and the guarantors’ current and future property and assets (other than the collateral securing our asset-backed credit facilities and certain other assets), including the capital stock of each wholly owned subsidiary of Edgen, which, in the case of foreign subsidiaries, is limited to 65% of the voting stock and 100% of the non-voting stock of each such subsidiary that is a first-tier foreign subsidiary. The Notes and related guarantees will be secured on a second priority basis by the collateral that secures our asset-backed credit facilities on a first priority basis.

Interest will be payable semi-annually at a rate of 8.750% per annum on May 1 and November 1 of each year, beginning on May 1, 2013.

We intend to use all of the net proceeds to us from this offering to repay or retire all of EMC’s outstanding senior secured notes (including the payment of premiums, consent fees, accrued interest and other fees and expenses associated with such repayment). Any remaining net proceeds would be used for general corporate purposes.

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