Freeport-McMoRan Copper & Gold Inc. (FCX) announced today that it has completed the sale of $6.5 billion of senior notes in four tranches, consisting of $1.5 billion of 2.375% Senior Notes due March 15, 2018, $1.0 billion of 3.100% Senior Notes due March 15, 2020, $2.0 billion of 3.875% Senior Notes due March 15, 2023 and $2.0 billion of 5.450% Senior Notes due March 15, 2043.
The offering generated net proceeds of about $6.4 billion, which Freeport-McMoRan expects to use, together with the net proceeds of its $4.0 billion term loan, mainly to fund the acquisitions of Plains Exploration & Production Co. and McMoRan Exploration Co. (MMR), including for the payment of cash consideration for the acquisitions and the repayment of certain indebtedness of PXP.
If the PXP acquisition does not close, FCX will be required to redeem all of the outstanding 7-year, 10-year and 30-year notes at 101% plus accrued and unpaid interest. PXP and MMR stockholder meetings to approve the acquisitions will be held after the U.S. Securities and Exchange Commission has declared effective the respective registration statements on Form S-4 filed in connection with the acquisitions. The deals are expected to close in second-quarter 2013. Freeport-McMoRan expects to record a charge of about $0.06 per share in the first quarter of 2013 for costs of the $9.5 billion acquisition bridge facilities which have been terminated, and for accrued interest costs associated with the March 7, 2013 issuance of the $6.5 billion in senior notes.
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