Mexican cement firm Cemex (NYSE: CX) has closed its US$1.67bn bond issue consisting of convertible subordinated notes due 2016 and 2018.
The notes are convertible into Cemex's American depositary shares (ADS) based on an initial conversion rate equivalent to US$11.28 per ADS. The company fully exercised the US$268mn over-allotment options granted to the initial purchasers, according to a press release.
The firm placed the offering on Mar 9, after initially saying it would offer some US$1.2bn. Cemex shares fell to a four-month low following the announcement.
Cemex will use the proceeds of the transaction to fund capped call transactions and to repay debt. The company aims to reduce its bank debt by US$2.3bn in 2011 to avoid US$200mn in additional interest, it said earlier this year.
Cemex, Mexico's largest cement producer, has struggled to pay back debt since its acquisition of Australian firm Rinker in 2007. The company's net debt at end-2010 was US$17.1bn.