Gerdau to Unveil $500m Syndication

Brazilian steelmaker Gerdau will tomorrow launch a $500m syndicated loan, marking its fourth visit to the markets in just eight months. The 3-year facility is heard paying Libor plus 125bp, and is led by Citi. The transaction will be presented to potential participants at a lunch meeting Wednesday in New York. “The only issue I can see with [the new loan] is that people are already holding a lot of Gerdau,” said one syndications banker away from the deal, adding he believes the price should clear the market. The company’s seemingly endless appetite for acquisitions and financing has brought Gerdau to every market available since last summer. In August, Gerdau launched a $2.75bn syndication with 5 and 6-year trade pieces at 100bp and 125bp, and a 5-year working capital piece at Libor plus 125bp. HSBC, ABN and JPMorgan were the leads. In October, the company sold a $1bn 2017 bond at 99.128 to yield 7.375%, through the same bank group. And last week, the company raised $2.4bn in a multi-tranche stock follow-on – its first equity deal in 13 years – via Itau BBA.