Steel Dynamics, Inc. STLD announced that it entered a $1.2-billion senior unsecured revolving credit facility. Notably, the credit facility is expected to mature on Dec 3, 2024.
Per management, the new credit facility is reflective of its balance sheet strength, the recent upgrade to investment grade status and ability to generate stable free cash flow.
Further, the company has the capacity to increase the size of the facility by $500 million, subject to certain conditions. This is expected to support its future growth initiatives.
PNC Capital Markets LLC, BofA Securities, Inc and Wells Fargo Securities, LLC acted as joint lead arrangers and joint bookrunners for the revolving credit facility.
Shares of Steel Dynamics have lost 1.9% in the past year compared with the industry’s 16.4% decline.
Considering domestic steel demand fundamentals, Steel Dynamics is optimistic regarding the 2020 North American steel market dynamics. The company believes that the North American steel consumption will experience modest growth. This is likely to be supported by the end of steel inventory destocking and further steel import reductions.
The company, in October, noted that it expects current trade actions to have a favorable impact in further lowering unfairly traded steel imports into the United States.
Steel Dynamics is positive about its Sinton, TX-based flat roll steel mill project as well as the related long-term value it will create through its value-added products and geographic…