ArcelorMittal SA, the steelmaker facing almost $15 billion of bond repayments over six years, is planning a capital increase of about 3 billion euros ($3.4 billion), according to people familiar with the matter.
The company could announce the share sale as early as this week, though the timing may change, the people said, asking not to be named as the details aren’t public. Billionaire Chief Executive Officer Lakshmi Mittal’s family trust, which already owns about 37 percent of the shares, will likely subscribe to a significant portion, they said.
A spokesman for ArcelorMittal declined to comment.
Shares in ArcelorMittal — the world’s largest steelmaker, supplying New York’s One World Trade Center and London’s Wembley stadium — have dropped 58 percent in the last 12 months. They’ve been hit by declining prices for steel as China pushes it onto the world market at record levels to counter its slowing economy. Prices for the ArcelorMittal mines have also dropped as demand for the steel-making material fell and supplies from exporters expanded.
ArcelorMittal’s U.S.-traded shares fell as much as 18 percent in after-market trading.
The company reported net debt of $16.8 billion at the end of the third quarter and said borrowings would fall below $15.8 billion by the end of 2015. ArcelorMittal is scheduled to report full-year earnings next week.
Vallourec SA, the French maker of steel tubes for the oil and gas industry, said Monday it plans to raise 1 billion euros by selling bonds and share to fund a restructuring prompted by the slump in crude. About 510 million euros will come from a share rights offering, the company based near Paris said in a statement.
Glencore Plc, the world’s third-largest mining company, raised about $2.5 billion sellingstock in September, as part of a wider $10 billion debt-reduction plan to protect its credit rating as commodity prices decline.