About Us - Press Release - CEMEX announces pricing of convertible subordinated notes
March 24, 2010
CEMEX, S.A.B. de C.V. (NYSE: CX), announced today the pricing of U.S.$650 million aggregate principal amount of 4.875% convertible subordinated Notes due 2015 (the “Notes”). CEMEX also granted the initial purchasers of the Notes a 30-day over-allotment option to purchase up to U.S.$65 million additional aggregate principal amount of Notes (subject to certain limitations).
The Notes will be convertible into American Depositary Shares, or ADSs, of CEMEX based on an initial conversion rate of 73.5402 ADSs per U.S.$1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately U.S.$13.60 per ADS and represents an approximately 30% conversion premium over the last reported sale price of ADSs on March 24, 2010. The conversion rate and the conversion price will be subject to adjustment in certain events, such as distributions of dividends or stock splits. CEMEX expects to close the Notes offering on or about March 30, 2010, subject to the satisfaction of various customary closing conditions.
Interest on the Notes will be payable semi-annually in arrears on March 15 and September 15 of each year, beginning September 15, 2010. The Notes will mature on March 15, 2015, unless previously converted or redeemed in accordance with their terms prior to such date. The Notes are not redeemable by CEMEX prior to the maturity date, except, subject to further limitations, upon certain changes in withholding taxes with respect to the Notes. The Notes will be general unsecured subordinated obligations of CEMEX and will be subordinated to all of CEMEX’s existing and future senior indebtedness.
In connection with the offering of the Notes, CEMEX intends to enter into a capped call transaction with an affiliate of one of the initial purchasers. This transaction is expected to generally reduce the potential cost to CEMEX upon future conversion of the Notes. If the initial purchasers exercise their over-allotment option, CEMEX may increase the size of the capped call transaction.
CEMEX intends to use the net proceeds from the offering of the Notes to fund the purchase of the capped call transaction, for general corporate purposes and to repay indebtedness, which may include indebtedness under CEMEX's Financing Agreement, as amended.
The Notes and the capped call transaction, as well as CEMEX’s ADSs and Certificados de Participación Ordinaria, or CPOs, underlying such securities, have not been registered under the U.S. Securities Act of 1933 (the "Securities Act") or any applicable state securities laws. The Notes will be offered only to qualified institutional buyers pursuant to Rule 144A promulgated under the Securities Act. Unless so registered, the Notes and the securities issuable upon conversion may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act and applicable state securities laws.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities, in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any state.
The Notes cannot be offered, sold publicly, or be the subject of brokerage activities in Mexico. The information included in the documents related to this offer is the sole responsibility of CEMEX and has not been reviewed or authorized by the Comisión Nacional Bancaria y de Valores (“CNBV”) in Mexico. The terms of the offer will be notified to the CNBV no later than one business day after the placement date of the Notes, only for information purposes, and will not imply certification as to the investment quality of the Notes or to the solvency of CEMEX.
This press release contains forward-looking statements and information that are necessarily subject to risks, uncertainties and assumptions. Many factors could cause the actual results, performance or achievements of CEMEX to be materially different from those expressed or implied in this release, including, among others, changes in general economic, political, governmental and business conditions globally and in the countries in which CEMEX does business, changes in interest rates, changes in inflation rates, changes in exchange rates, the level of construction generally, changes in cement demand and prices, changes in raw material and energy prices, changes in business strategy and various other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. CEMEX assumes no obligation to update or correct the information contained in this press release.