By Devika Patel
Knoxville, Tenn., Nov. 21 - USG Corp. negotiated a $400 million private placement of 10% contingent convertible senior notes due 2018, according to a press release.
Of the notes being sold, $300 million will be issued to Berkshire Hathaway Inc. and $100 million will be sold to Fairfax Financial Holdings Ltd.
USG said that in accordance with New York Stock Exchange rules it will seek shareholder approval to allow conversion of the notes into stock.
If granted, the notes will be convertible into common shares at $11.40 per share.
If approval is not obtained within 135 days after settlement, the interest rate will step up to 20% until authorization is received.
Proceeds will be used for general corporate purposes include repayment of part of the borrowings on USG's credit facility.
USG is a Chicago-based building products company.
| Issuer: | USG Corp.
|
| Issue: | Contingent convertible senior notes
|
| Amount: | $400 million
|
| Maturity: | 2018
|
| Coupon: | 10%
|
| Price: | Par
|
| Yield: | 10%
|
| Conversion price: | $11.40
|
| Warrants: | No
|
| Investor: | Berkshire Hathaway Inc. ($300 million), Fairfax Financial Holdings ($100 million)
|
| Pricing date: | Nov. 21
|
| Stock symbol: | NYSE: USG
|
| Stock price: | $5.66 at close Nov. 20
|
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