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JBS USA Completes Debt Rebalancing

01 July 2011

US - Brazilian beef processor JBS SA's subsidiary JBS USA has priced its Asset Based Loan (ABL) at $850 million and an interest rate of LIBOR + 1.75 per cent annually, with a five year maturity.

The Company opted to expand the initial amount from $800 million to $850 million because of demand, which reached $2 billion and an interest rate significantly lower than expected.

This operation completes the debt rebalancing process of the company which includes the following completed operations:

  • Senior Unsecured Bond in the amount of US$650 million with a 10 year maturity and a coupon of 7.25% annually.
  • Term Loan B in the amount of US$475 million with a 7 year maturity and a cost of LIBOR + 3 per cent annually.
  • Term Loan A in JBS Five Rivers in the amount of US$85 million with a 5 year maturity and a cost of LIBOR + 2.75 per cemt annually.

The total operations amounted to $2.06 billion with an average cost of 4.35 per cent, resulting in a reduction in the cost of debt and a more efficient tax structure, which together represent a savings for the company around $150 million per year. Besides this, there will be an improvement in debt profile, reducing the share of short term debt.

TheCattleSite News Desk



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