CEMEX S.A.B. de C.V. (“CEMEX”) (NYSE:CX) announced today the completion of its financial plan for 2012, which included several transactions to refinance and/or prepay debt scheduled to mature through 2014, thereby increasing the company’s financial flexibility and significantly reducing its refinancing risk.
Under this year’s financial plan, CEMEX reduced the amount of debt maturing through March 2015 to about U.S.$650 million, at currently prevailing foreign-exchange rates, of which approximately U.S.$600 million matures during the first quarter of 2014. In addition, the average life of debt increased to 5.6 years, from 3.8 years at the beginning of this year, with no significant change in yearly interest expense.
The execution of the 2012 financial plan included various transactions, among others:
- Refinancing of close to U.S.$6.7 billion of debt under the Financing Agreement dated as of August 14, 2009, as amended (the “Financing Agreement”), into a new Facilities Agreement (the “New Facilities Agreement”) with a final maturity in 2017 and U.S.$500 million of new senior secured notes due 2018. The New Facilities Agreement provides CEMEX with more flexible operating and financial covenants.
- Issuance of U.S.$940 million in new senior secured notes maturing in 2019 in exchange for approximately U.S.$452 million in perpetual debentures and U.S.$619 million in 2014 Eurobonds, resulting in a reduction of CEMEX’s overall indebtedness of U.S.$131 million.
- Issuance of U.S.$1.5 billion of new senior secured notes due 2022 (the “2022 Notes”).
- Initial share offering of a 26.65% minority position in CEMEX Latam Holdings, S.A.(“CLH”), resulting in net proceeds of about U.S.$960 million.
Proceeds from the 2022 Notes and CLH’s initial share offering were used to prepay debt under the New Facilities Agreement and the Financing Agreement. As a result of these prepayments, the spread over 3-month LIBOR on the New Facilities Agreement was reduced to 450 basis points, the same spread CEMEX had under the original Financing Agreement while, as a result of the refinancing of this agreement, the final maturity of this debt was extended by three years.
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