Japan's Nippon Steel announced plans to raise 550 billion yen, approximately $3.55 billion, through a euro-yen convertible bond sale. The company intends to utilize these funds to finance its business operations and support its acquisition of U.S. Steel.
The bond issuance will be conducted in two equal tranches of 275 billion yen, maturing in 2029 and 2031. These bonds will feature stock acquisition rights and carry zero interest.
This move follows earlier reports regarding Nippon Steel's intentions for a convertible bond sale, aimed at replacing a bridge loan taken out for the $15 billion U.S. Steel purchase. The company has also committed to additional investments in the U.S. asset to secure regulatory approval for the merger.
Earlier this month, Nippon Steel revised its net loss forecast for the financial year ending March to 70 billion yen, citing a blast furnace fire and charges associated with the U.S. Steel acquisition.