8-KLeadership ChangesAcquisitions & DispositionsMaterial Agreements+4

FREEPORT-MCMORAN INC 8-K Report, Material Agreement (Jun 3, 2013)

Filed June 3, 2013For Securities:FCX

Summary

Freeport-McMoRan Inc. (FCX) filed this Form 8-K to report the completion of two significant merger transactions: the acquisition of Plains Exploration & Production Company (PXP) on May 31, 2013, and the acquisition of McMoRan Exploration Co. (MMR) on June 3, 2013. These acquisitions significantly expand FCX's oil and gas operations, aiming to create a premier U.S.-based natural resource company. The report details the terms of these mergers, including the consideration offered to shareholders and the assumption of debt obligations. The filings also cover the necessary financial and legal adjustments following these transactions. This includes the entry into supplemental indentures to manage existing PXP and MMR debt, as well as FCX's own senior notes. Furthermore, FCX secured $4.0 billion in new term loan financing and updated its revolving credit facility in connection with the PXP acquisition. The report also notes changes to FCX's Board of Directors to accommodate individuals from the acquired companies and announces a supplemental dividend of $1.00 per share.

Key Highlights

  • 1Completion of the acquisition of Plains Exploration & Production Company (PXP) on May 31, 2013, for a mix of cash and FCX stock, with an approximate total per share consideration value of $46.01.
  • 2Completion of the acquisition of McMoRan Exploration Co. (MMR) on June 3, 2013, with MMR shareholders receiving $14.75 in cash and 1.15 royalty trust units per share.
  • 3These transactions mark a strategic expansion of FCX into a larger oil and gas business, aiming to establish it as a premier U.S. natural resource company.
  • 4FCX assumed obligations related to PXP's outstanding senior notes through supplemental indentures and guaranteed payment obligations.
  • 5FCX also guaranteed MMR's outstanding 11.875% Senior Notes due 2014 and addressed the convertibility of MMR's 4% and 5 1/4% Convertible Senior Notes.
  • 6FCX borrowed $4.0 billion under a new term loan agreement and updated its revolving credit agreement in conjunction with the PXP acquisition.
  • 7The FCX Board of Directors was expanded to include three new members from PXP, and a supplemental dividend of $1.00 per share was declared.

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