Magnesita wants to raise up to 425 million in stock offering

SAO PAULO, Dec. 20, 2010 - Magnesita, the third largest producer of refractory materials in the world, will do a primary offering of shares estimated between $ 255 million and $ 425 million. The application for registration of the operation was referred to the Brazilian Association of Financial and Capital Markets (Anbima).
The final value of the offer will depend on market conditions at the time of pricing, to be held by bookbuilding (collection of investment intentions) with institutional investors. The coordinators of the operation, which will work placement abroad, are Itau BBA and Credit Suisse.
According to material fact, the company's intention is to use the proceeds to reduce bank debt. So the company could obtain more favorable financing lines, mainly from multilateral institutions and funding agencies to move forward with planned investments.
Among the projects, Magnesita highlights the investment of about $ 220 million to expand production of M-30 (sinter manganese oxide) in its fund-Bahia Brumado at 120 000 tonnes a year by 2012. The graphite mine in the company should receive other $ 80 million over the next 24 months to raise production to 40,000 tonnes per annum. Magnesita states already have cash resources to implement these investments.