United States Steel has announced the closing of USD 290 million unsecured Arkansas Development Finance Authority environmental improvement revenue bonds, which carry a green bond designation. Proceeds of the bonds will be used for eligible Green Projects within the meaning of the Green Bond Principles of The International Capital Market Association. US Steel said “We are also continuing to strengthen our balance sheet, in-line with our capital allocation priorities, by replacing more expensive, nearer-term debt with less expensive, longer-dated debt, all while reducing our interest expense and extending our maturity profile.”The Green Bonds, issued through Arkansas Development Finance Authority, have a coupon rate of 5.45% and carry a final maturity of 2052. Under the agreement with the Arkansas bond issuer, US Steel will pay semiannual interest.The Company will use the proceeds from the Green Bonds to partially fund work related to its solid waste disposal facilities, including two electric arc furnaces and other equipment and facilities at its new technologically advanced flat rolled steelmaking facility, Big River 2, currently under construction near Osceola, Arkansas. The facility will recycle, refine, and process scrap steel into finished steel products.Construction of Big River 2 is expected to be completed in 2024, and once complete will be the most advanced steelmaking facility in North America, featuring two EAFs, with a total three million tons per year of advanced steelmaking capability, a state-of-the-art endless casting and rolling line and advanced finishing capabilities. BR2 is expected to operate with up to 70-80% fewer greenhouse gas emissions compared to the traditional integrated steelmaking approach and directly support the Company’s sustainability commitments.Separately, US Steel repurchased approximately USDD 300 million of outstanding debt at a discount to par through a tender offer process completed last week.Together, these actions result in the following improvementsWeighted average debt maturity is now approximately 14 yearsReduced cash interest expense: Annual cash interest savings of approximately $5 millionMaintained leverage metric: Leverage neutral while strengthening our financial position.BofA Securities, Barclays, Citigroup, Goldman Sachs, JP Morgan, Morgan Stanley, Wells Fargo Securities and Crews & Associates acted as underwriters for the Green Bonds.
United States Steel has announced the closing of USD 290 million unsecured Arkansas Development Finance Authority environmental improvement revenue bonds, which carry a green bond designation. Proceeds of the bonds will be used for eligible Green Projects within the meaning of the Green Bond Principles of The International Capital Market Association. US Steel said “We are also continuing to strengthen our balance sheet, in-line with our capital allocation priorities, by replacing more expensive, nearer-term debt with less expensive, longer-dated debt, all while reducing our interest expense and extending our maturity profile.”The Green Bonds, issued through Arkansas Development Finance Authority, have a coupon rate of 5.45% and carry a final maturity of 2052. Under the agreement with the Arkansas bond issuer, US Steel will pay semiannual interest.The Company will use the proceeds from the Green Bonds to partially fund work related to its solid waste disposal facilities, including two electric arc furnaces and other equipment and facilities at its new technologically advanced flat rolled steelmaking facility, Big River 2, currently under construction near Osceola, Arkansas. The facility will recycle, refine, and process scrap steel into finished steel products.Construction of Big River 2 is expected to be completed in 2024, and once complete will be the most advanced steelmaking facility in North America, featuring two EAFs, with a total three million tons per year of advanced steelmaking capability, a state-of-the-art endless casting and rolling line and advanced finishing capabilities. BR2 is expected to operate with up to 70-80% fewer greenhouse gas emissions compared to the traditional integrated steelmaking approach and directly support the Company’s sustainability commitments.Separately, US Steel repurchased approximately USDD 300 million of outstanding debt at a discount to par through a tender offer process completed last week.Together, these actions result in the following improvementsWeighted average debt maturity is now approximately 14 yearsReduced cash interest expense: Annual cash interest savings of approximately $5 millionMaintained leverage metric: Leverage neutral while strengthening our financial position.BofA Securities, Barclays, Citigroup, Goldman Sachs, JP Morgan, Morgan Stanley, Wells Fargo Securities and Crews & Associates acted as underwriters for the Green Bonds.
