GrafTech International Ltd. (NYSE:EAF) (the “Company” or
“GrafTech”) today announced that its wholly owned subsidiary,
GrafTech Global Enterprises Inc. (“GrafTech Global Enterprises”),
has commenced a private offering of $450 million aggregate
principal amount of senior secured notes due 2028 (the “Notes”),
subject to market conditions.
The proceeds from this offering are intended to be used to repay
the debt outstanding under the secured term loan facility provided
for by the credit agreement entered into by GrafTech in February
2018 (as amended, the “2018 Credit Agreement”), and pay all related
fees and expenses and, to the extent any proceeds remain, for
general corporate purposes.
It is expected that the Notes will be guaranteed on a senior
secured basis by (i) GrafTech Finance Inc., an indirect, wholly
owned subsidiary of GrafTech and issuer of the outstanding 4.625%
Senior Secured Notes due 2028 (the “Existing Secured Notes”), (ii)
GrafTech and all of GrafTech’s direct and indirect U.S.
subsidiaries that, as of the issue date for the Notes, guarantee
(or are borrowers of) the debt under the credit facilities provided
for by the 2018 Credit Agreement (the “Senior Secured Credit
Facilities”), other than the Issuer, and (iii) all of GrafTech’s
future direct and indirect subsidiaries that guarantee (or are
borrowers of) (1) the debt under the Senior Secured Credit
Facilities, (2) the Existing Secured Notes and (3) certain other
future indebtedness, in each case, other than certain excluded
foreign subsidiaries. The Notes and the note guarantees will be
secured on a first-priority basis by liens on the collateral of the
Issuer and the guarantors securing the debt under the Senior
Secured Credit Facilities and the Existing Secured Notes, on an
equal and ratable basis with the debt under the Senior Secured
Credit Facilities and the Existing Secured Notes, in each case
subject to permitted liens and certain exceptions.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy any securities. The Notes and
related guarantees are being offered only to persons reasonably
believed to be qualified institutional buyers in reliance on Rule
144A under the Securities Act of 1933 (the “Securities Act”) and to
non-U.S. persons outside the United States in reliance on
Regulation S under the Securities Act. The Notes and the related
guarantees have not been and will not be registered under the
Securities Act, any state securities laws or the securities laws of
any other jurisdiction, and may not be offered or sold in the
United States without registration or an applicable exemption from
registration under the Securities Act and applicable state
securities and other securities laws.
About GrafTech
GrafTech International Ltd. is a leading manufacturer of
high-quality graphite electrode products essential to the
production of electric arc furnace steel and other ferrous and
non-ferrous metals.
Cautionary Note Regarding Forward-Looking Statements
This release may contain forward-looking statements within the
meaning of the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements reflect our current views with respect to, among other
things, financial projections, plans and objectives of management
for future operations, and future economic performance. Examples of
forward-looking statements include, among others, statements we
make regarding future estimated revenues and volume derived from
our take-or-pay agreements with initial terms of three-to-five
years (“LTA”), future pricing of short-term agreements and spot
sales (“non-LTA”), anticipated levels of capital expenditures, and
guidance relating to earnings per share and adjusted EBITDA. You
can identify these forward-looking statements by the use of
forward-looking words such as “will,” “may,” “plan,” “estimate,”
“project,” “believe,” “anticipate,” “expect,” “foresee,” “intend,”
“should,” “would,” “could,” “target,” “goal,” “continue to,”
“positioned to,” “are confident,” or the negative versions of those
words or other comparable words. Any forward-looking statements
contained in this press release are based upon our historical
performance and on our current plans, estimates and expectations
considering information currently available to us. The inclusion of
this forward-looking information should not be regarded as a
representation by us that the future plans, estimates, or
expectations contemplated by us will be achieved. Our expectations
and targets are not predictions of actual performance and
historically our performance has deviated, often significantly,
from our expectations and targets. These forward-looking statements
are subject to various risks and uncertainties and assumptions
relating to our operations, financial results, financial condition,
business, prospects, growth strategy and liquidity. Accordingly,
there are or will be important factors that could cause our actual
results to differ materially from those indicated in these
statements. We believe that these factors include, but are not
limited to: our dependence on the global steel industry generally
and the electric arc furnace steel industry in particular; the
cyclical nature of our business and the selling prices of our
products, which may decline in the future, may lead to periods of
reduced profitability and net losses in the future; the sensitivity
of our business and operating results to economic conditions,
including any recession, and the possibility others may not be able
to fulfill their obligations to us in a timely fashion or at all;
the possibility that we may be unable to implement our business
strategies in an effective manner; the possibility that global
graphite electrode overcapacity may adversely affect graphite
electrode prices; the competitiveness of the graphite electrode
industry; our dependence on the supply of raw materials, including
decant oil and petroleum needle coke and disruptions in supply
chains for these materials; our reliance on one facility in
Monterrey, Mexico for the manufacturing of connecting pins; the
availability and cost of electric power and natural gas,
particularly in Europe; our manufacturing operations are subject to
hazards; the legal, compliance, economic, social and political
risks associated with our substantial operations in multiple
countries; the possibility that fluctuation of foreign currency
exchange rates could materially harm our financial results; the
possibility that our results of operations could deteriorate if our
manufacturing operations were substantially disrupted for an
extended period, including as a result of equipment failure,
climate change, regulatory issues, natural disasters, public health
crises, such as the COVID-19 pandemic, political crises or other
catastrophic events; the risks and uncertainties associated with
litigation, arbitration, and like disputes, including disputes
related to contractual commitments; our dependence on third parties
for certain construction, maintenance, engineering, transportation,
warehousing and logistics services; the possibility that we are
subject to information technology systems failures, cybersecurity
attacks, network disruptions and breaches of data security; the
possibility that we are unable to recruit or retain key management
and plant operating personnel or successfully negotiate with the
representatives of our employees, including labor unions; the
sensitivity of goodwill on our balance sheet to changes in the
market; our dependence on protecting our intellectual property and
the possibility that third parties may claim that our products or
processes infringe their intellectual property rights; the impact
of inflation and our ability to mitigate the effect on our costs;
the impact of macroeconomic and geopolitical events, including
developments arising from the COVID-19 pandemic and the conflict
between Russia and Ukraine, on our business, results of operations,
financial condition and cash flows, and the disruptions and
inefficiencies in our supply chain that may occur as a result of
such events; the possibility that our indebtedness could limit our
financial and operating activities or that our cash flows may not
be sufficient to service our indebtedness; recent increases in
benchmark interest rates and the fact that borrowings under certain
of our existing financing agreements subject us to interest rate
risk; the possibility that disruptions in the capital and credit
markets could adversely affect our results of operations, cash
flows and financial condition, or those of our customers and
suppliers; the possibility that restrictive covenants in our
financing agreements could restrict or limit our operations;
changes in, or more stringent enforcement of, health, safety and
environmental regulations applicable to our manufacturing
operations and facilities; the possibility that the market price of
our common stock could be negatively affected by sales of
substantial amounts of our common stock in the public markets,
including by Brookfield Corporation and its affiliates; the fact
that our stockholders have the right to engage or invest in the
same or similar businesses as us; the possibility that we may not
pay cash dividends on our common stock in the future; and GrafTech
Global Enterprises’ ability to complete the Notes offering on terms
that are commercially attractive to it or at all.
These factors should not be construed as exhaustive and should
be read in conjunction with the other cautionary statements,
including the “Risk factors” section in our most recent Annual
Report on Form 10-K and other filings with the Securities and
Exchange Commission (“SEC”). The forward-looking statements made in
this press release relate only to events as of the date on which
the statements are made. Except as required by law, we do not
undertake any obligation to publicly update or review any
forward-looking statement, whether as a result of new information,
future developments or otherwise.
If one or more of these or other risks or uncertainties
materialize, or if our underlying assumptions prove to be
incorrect, our actual results may vary materially from what we may
have expressed or implied by these forward-looking statements. We
caution that you should not place undue reliance on any of our
forward-looking statements. You should specifically consider the
factors identified in this press release and in our SEC reports,
including, but not limited to, our most recent Annual Report on
Form 10-K and our Quarterly Report on Form 10-Q, as filed with the
SEC, that could cause actual results to differ before making an
investment decision to purchase our common stock. Furthermore, new
risks and uncertainties arise from time to time, and it is
impossible for us to predict those events or how they may affect
us.
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version on businesswire.com: https://www.businesswire.com/news/home/20230619896442/en/
Michael Dillon 216-676-2000
GrafTech (NYSE:EAF)
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