United States Steel Corporation (NYSE:X) completed the acquisition of 47.62% stake in Big River Steel LLC from GCP/BRS Investors, LLC, managed by Gcp Metals Investments, Llc, Koch Minerals LLC, TPG Furnace, L.P. and others.
October 30, 2019
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United States Steel Corporation (NYSE:X) signed an agreement to acquire 47.62% stake in Big River Steel LLC from GCP/BRS Investors, LLC, managed by Gcp Metals Investments, Llc, Koch Minerals LLC, TPG Furnace, L.P. and others for $1.1 billion on September 30, 2019. The purchase price of 49.9% equity is $700 million in cash with an enterprise value of $2.3 billion. The purchase price is subject to adjustments. A portion of the purchase price in the amount of $16.7 million will be deposited in adjustment escrow account and shall be the sole source of payment of any purchase price adjustment. Upon the completion of the transaction, Koch Minerals LLC and TPG Furnace, L.P. would remain preferred equity holders of Big River Steel LLC. In a related transaction, United States Steel Corporation signed a definitive agreement to acquire 2.3% stake in Big River Steel LLC from TPG Growth II BDH, L.P. for $53 million. United States Steel Corporation is acquiring a total of 49.9% as part of the two transactions and will also have a call option to acquire remaining 50.1%. United States Steel Corporation has committed financing to execute the transaction. United States Steel Corporation intends to increase its existing $1.5 billion asset-backed lending facility to $2 billion and draw on the upsized asset-backed lending facility to fund the transaction. The upsized asset-backed lending facility has been fully committed by Barclays Capital.
The transaction is subject to each equity holder having confirmed in writing its approval of the transaction and the waiver of all rights of first offer or similar rights, approval by third parties, completion of restructuring, closing of the transaction involving acquisition of 2.3% stake in Big River Steel LLC by United States Steel Corporation from TPG Growth II BDH, L.P. Closing of the transaction is anticipated on October 31, 2019.
Robert Kennedy, Iliana Ongun, Jane Hanson, Fiona Schaeffer, Michael Bellucci, James Ball, Brett Nadritch, Mike Shah, Max Goodman and Matt Ahrens of Milbank LLP acted as legal advisor for United States Steel Corporation. Daniel Grabos at Barclays Capital Inc. acted as financial advisor to United States Steel Corporation. Albert T. Adams, Martin Booher, Phillip Callesen, Suzanne Hanselman, Melissa Leonard, Edward Ptaszek Jr. and Peter Van Euwen of Baker & Hostetler LLP acted as legal advisor for Big River Steel LLC while J.P. Morgan Securities LLC and Goldman Sachs & Co. LLC acted as financial advisors. Bryan E. Davis of Jones Day acted as legal advisors for Koch Minerals LLC. Kevin Schmidt, Chris Anthony and Peter Furci of Debevoise & Plimpton LLP acted as legal advisors for TPG Furnace, L.P. Steven Epstein and Warren S. de Wied of Fried Frank acted as legal advisor to Barclays Capital.
United States Steel Corporation (NYSE:X) completed the acquisition of 47.62% stake in Big River Steel LLC from GCP/BRS Investors, LLC, managed by Gcp Metals Investments, Llc, Koch Minerals LLC, TPG Furnace, L.P. and others on October 31, 2019.
United States Steel Corporation is a steel producer. The Company operates through four segments: North American Flat-Rolled (Flat-Rolled), Mini Mill, U. S. Steel Europe (USSE) and Tubular Products (Tubular). The Flat-Rolled segment is involved in the production of slabs, strip mill plates, sheets and tin mill products, as well as all iron ore, direct reduced grade pellets, pig iron, and coke production facilities in the United States. The Mini Mill segment produces hot-rolled, cold-rolled, coated sheets and electrical steels. The USSE segment produces and sells slabs, strip mill plate, sheet, tin mill products and spiral welded pipe. The Tubular segment produces and sells rounds, seamless and electric resistance welded (ERW) steel casing and tubing (OCTG), and standard and line pipe and mechanical tubing. It serves the automotive, construction, appliance, energy, container, and packaging industries with high value-added steel products such as its XG3 advanced high-strength steel.
United States Steel Corporation (NYSE: X) completed the acquisition of 47.62% stake in Big River Steel LLC from GCP/BRS Investors, LLC, managed by Gcp Metals Investments, Llc, Koch Minerals LLC, TPG Furnace, L.P. and others.