United States Steel Corporation (NYSE:X) signed a definitive agreement to acquire 2.3% stake in Big River Steel LLC from TPG Growth II BDH, L.P. for approximately $53 million.
October 30, 2019
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United States Steel Corporation (NYSE:X) signed a definitive agreement to acquire 2.3% stake in Big River Steel LLC from TPG Growth II BDH, L.P. for approximately $53 million on September 30, 2019. The purchase price is subject to closing adjustments. In a related transaction, United States Steel Corporation will acquire an additional 47.6% stake in Big River Steel LLC from TPG and others. 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%. U. S. Steel has committed financing to execute the transaction. U. S. Steel 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. As of October 15, 2019, the size of the lenders’ commitments under our credit agreement increased from $1.5 billion to $2 billion. United States will only draw down amounts under the existing credit agreement, if the new ABL credit Agreement of $2 billion does not become effective prior to the consummation of the BRS joint venture. The transaction is subject to the consummation of another merger and other customary closing conditions. The transaction is expected to complete on October 31, 2019.
Barclays Capital is serving as financial advisor and 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 to United States Steel. Albert Adams, Martin Booher, Phillip Callesen, Suzanne Hanselman, Melissa Leonard, Edward Ptaszek Jr. and Peter Van Euwen of Baker & Hostetler LLP acted as legal advisor and J.P. Morgan Securities LLC and Goldman Sachs & Co. LLC are serving as financial advisors to Big River. Kevin M. Schmidt, Peter Furci and Christopher Anthony of Debevoise & Plimpton LLP acted as legal advisor to TPG Growth II BDH, L.P. Steven Epstein and Warren S. de Wied of Fried Frank acted as legal advisor to Barclays Capital.
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) signed a definitive agreement to acquire 2.3% stake in Big River Steel LLC from TPG Growth II BDH, L.P. for approximately $53 million.