Cemex have announced the pricing of US$1 billion of its subordinated notes with no fixed maturity denominated in US Dollars.
The Notes have no fixed maturity date and will be subordinated to all senior obligations, equal in right of payment to existing subordinated notes, and senior only to equity. The Notes will bear interest semi-annually at an initial rate of 7.200% per annum, subject to the right of Cemex to defer interest payments. The interest rate will reset every five years commencing on September 10, 2030 (the date that is 5.25 years after the issue date) (the “First Step-up Date”). The step-up interest rate for reset periods commencing on the First Step-Up Date and ending on September 10, 2050 (the date that is 20 years after the First Step-up Date) (the “Second Step-up Date”), will be calculated based on the five-year U.S. Treasury plus the initial margin of 3.270% (the “Initial Margin”) plus 0.25% per annum (the “First Step-up Margin”). The step-up interest rate for reset periods commencing on and after the Second Step-up Date will be calculated based on the five-year U.S. Treasury plus the
Initial Margin plus the First Step-up Margin plus 0.75% per annum.
The Notes will be issued at a price of 100.000% of face value. Cemex will be entitled to call the Notes prior to June 10, 2030 by paying a make-whole amount. Cemex will also be entitled to call the Notes (i) on any day during the period commencing on and including June 10, 2030 and ending on and including the First Step-up Date, and (ii) on each interest payment date thereafter, in each case at par. In addition, upon the occurrence of certain rating methodology, tax deductibility, withholding tax, substantial repurchase or accounting events, or a change of control resulting in a ratings decline, Cemex will have the option to redeem, in whole but not in part, the Notes at specified redemption prices. If Cemex does not redeem the Notes by the 90th day following the occurrence of a change of control resulting in a ratings decline, as further described in the preliminary offering memorandum, interest on the Notes will permanently increase by a rate of 5.0% per annum.
The closing of the offering is expected to occur on June 10, 2025, subject to satisfaction of customary closing conditions.
Cemex intends to use the net proceeds from the sale of the Notes for general corporate purposes, including to repay debt or other financial obligations.
Cemex does not expect the Notes to be included in Consolidated Net Debt when calculating the Consolidated Leverage Ratio pursuant to (and as each defined in) Cemex’s main credit agreements.
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