02.04.2014

Mills to raise $88 million

Mills, the Brazilian rental company and scaffold contractor, is planning to issue up to R200 million ($88 million) worth of unsecured, non-convertible debentures with a five-year term for public distribution/sale.

The debentures will be issued in a single tranche and bear interest at a percentage yet to be defined, but limited to 109.25 percent of the interbank deposit certificate rate (DI rate).

Prior to this offering - later this month - Mills will issue promissory notes, totalling R200 million ($88 million) with interest of 106 percent of the DI rate, which will be settled with the proceeds from the debenture sales. The funds raised will be used to refinance the company’s debt, purchase more rental equipment and for general corporate expenses.

The company believes that, as its investment matures, its operating cash flow will increase and, as a result, its leverage, measured by net debt/EBITDA ratio, will return to a level close to its target of one percent by the end of 2014.