Molycorp Inc. (NYSE: MCP) has announced that it intends to offer and sell $300 million aggregate principal amount of convertible senior notes due in 2017 and $150 million of its common stock. The offerings would come to $345 million AND/OR up to $172.5 million, respectively, if Morgan Stanley exercises its overallotment option.
The use of proceeds is to fund operating expenses, working capital, capital expenditures and any other cash requirements for the remainder of 2012 and the first six months of 2013. In short, this offering is aimed to address the recent Standard & Poor’s downgrade. The fund usage includes capital expenditures at its Mountain Pass facility and other capital projects, and cash payments due this month to certain holders of the 5% subordinated unsecured convertible debentures of Molycorp Canada.
The company is also agreeing to lend Morgan Stanley shares up to $138 million in common stock to facilitate the note offering.
Morgan Stanley and Credit Suisse are sharing the notes offering book-runner status; Morgan Stanley will be the sole book-runner for the shares offering.
Molycorp shares are indicated down more than 9% at $10.95 against a 52-week range of $11.22 to $58.74. Before the effects of this offering, the market capitalization of Molycorp is $1.2 billion.
JON C. OGG
The Average American Is Losing Their Savings Every Day (Sponsor)
If you’re like many Americans and keep your money ‘safe’ in a checking or savings account, think again. The average yield on a savings account is a paltry .4% today, and inflation is much higher. Checking accounts are even worse.
Every day you don’t move to a high-yield savings account that beats inflation, you lose more and more value.
But there is good news. To win qualified customers, some accounts are paying 9-10x this national average. That’s an incredible way to keep your money safe, and get paid at the same time. Our top pick for high yield savings accounts includes other one time cash bonuses, and is FDIC insured.
Click here to see how much more you could be earning on your savings today. It takes just a few minutes and your money could be working for you.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
