ArcelorMittal Confirms Covenant Discussions
07/09/2009 - ArcelorMittal confirms that it is in advanced discussions with its principal bankers regarding possible changes to the financial leverage covenant in its main banking facilities.
ArcelorMittal is in advanced discussions with its principal bankers regarding possible changes to the financial leverage covenant in its main banking facilities.
Although it does not anticipate breaching the existing covenant, ArcelorMittal said it believes it would be prudent to strengthen its financial position as a precaution against any further unexpected downturn. The company is negotiating to change the loan covenant for a period of one year, and noted that the change would not increase the borrowing costs under normal conditions of financial performance.
At the end of the first quarter of 2009, adjusted for subsequent capital market transactions, ArcelorMittal had strong liquidity of USD 23 billion and has raised more than USD 11 billion from equity, convertible and other bond issues this year. The company said it has also made good progress toward its goal of reducing debt by USD 10 billion by the end of 2009.
ArcelorMittal said that it is confident of a prompt and positive conclusion to these discussions, and said that it would make a further announcement at that time.
ArcelorMittal is the world's largest steel company, with operations in more than 60 countries. It is a leader in a range of major global steel markets, including automotive, construction, household appliances and packaging, with leading R&D and technology, as well as sizeable captive supplies of raw materials and outstanding distribution networks. With an industrial presence in over 20 countries spanning four continents, the company covers the key steel markets, from emerging to mature.
Through its core values of sustainability, quality and leadership, ArcelorMittal commits to operating in a responsible way with respect its employees, contractors and the communities in which it operates. It is also committed to the sustainable management of the environment and of finite resources. ArcelorMittal also takes a leading role in the industry's efforts to develop breakthrough steelmaking technologies and is actively researching and developing steel-based technologies and solutions that contribute to combat climate change.
In 2008, ArcelorMittal had revenues of $124.9 billion and crude steel production of 103.3 million tonnes, representing approximately 10% of world steel output.
