Essar Steel Minnesota is offering a high-yield bond to raise $450 million for construction of its iron ore mine and processing plant in Nashwauk, the online publication IFR Asia is reporting.
In a story dated May 8, the publication says Essar is offering a 12 percent return on a six-year non-call bond.
“Credit Suisse priced the Caa1/CCC+ rated issue at 97.901 with an 11.50% coupon. But it immediately jumped to 101.25 bid in the secondary and offered a generous pickup to iron ore peer Magnetation’s five-year US$325m bond, which priced at 11% at par last year and is yielding around 7.54 percent now,” IFR Asia reported.
Essar, which intends to be producing taconite pellets by the first quarter of 2016, halted construction last winter. It faces several liens for allegedly failing to pay contractors.