Fortescue to make US$1 billion debt repayment

Fortescue Metals Group (FMG) has announced plans to issue a US$1 billion ($1.3 billion) Term Loan repayment as part of its debt reduction strategy.

The company will make the repayment on March 30 and will generate annual interest savings of nearly US$38 million.

Following the repayment, the Term Loan will be reduced to US$976 million.

FMG CEO Nev Power said the repayment continued with the company’s debt reduction strategy; lowering its 2019 debt to less than US$1 billion.

“Productivity and efficiency initiatives have delivered sustained cost reductions and combined with strong market conditions are generating significant free cash flow,” he said.

“We will continue to prioritise free cash flow for debt reduction, investment in our core iron ore business and returns to shareholders.”

The latest repayment comes after FMG reduced its debt by another US$1 billion in December last year.

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