Fresnillo’s $850 Million Offering and Concurrent Tender Offer

Cleary Gottlieb, Travers Smith and Ritch, Mueller, Heather y Nicolau represented Fresnillo plc, while Davis Polk and Creel, García-Cuéllar, Aiza y Enríquez advised the initial purchasers in the transaction.

Fresnillo plc (Fresnillo), the world’s largest silver producer and Mexico’s largest gold producer, executed its international offering of $850 million 4.250% notes due 2050 (the “2050 Notes”) and its concurrent abbreviated five-day cash tender offer for any and all of its outstanding 5.500% notes due 2023 (the “2023 Notes”).

The 2050 Notes, which are expected to be admitted to the Official List of the Irish Stock Exchange and trade on the Global Exchange Market of Euronext Dublin, were offered and sold within the United States to qualified institutional buyers under Rule 144A and outside the United States in reliance of Regulation S. Citigroup, J.P. Morgan and Santander acted as joint bookrunners and lead managers. The offering launched on September 22, 2020, priced on September 29, 2020 and closed on October 2, 2020.

Fresnillo used the proceeds of the offering of the 2050 Notes to purchase approximately $482 million aggregate principal amount of 2023 Notes that were tendered in a concurrent abbreviated tender offer. Citigroup, J.P. Morgan and Santander acted as dealer managers in the tender offer. The tender offer launched on September 22, 2020, expired on September 29, 2020 and settled on October 2, 2020.

Fresnillo is a leading precious metals company with operations in Mexico, and has significant experience and expertise in all areas of mining, including the exploration, development, extraction and processing of ore with gold, silver, zinc and lead metal contents to produce concentrates, dorés and other materials. Cleary recently represented Industrias Peñoles S.A.B. de C.V., Fresnillo’s parent company, in two bond offerings totaling $1.7 billion.

The Cleary corporate team advising Fresnillo included partners Jorge Juantorena (Picture) and Manuel Silva, associates Isa Julson Barahona and Ethan Back, and law clerk Brayan Acevedo Vazquez. Partner Jason Factor, senior attorney David Stewart Fisher, and associate Michael Eis advised on U.S. tax matters. Partner Richard Sultman advised on UK tax matters. Senior attorney Marc Rotter advised on Investment Company Act considerations.

In UK, Travers Smith advised Fresnillo with Jon Reddington, Simon Skinner, Charlotte Courtney and Aimee Hutchinson.

In Mexico, Ritch, Mueller, Heather y Nicolau advised Fresnillo with Luis Nicolau Gutiérrez, Oscar A. López Velarde, Joshua Párraga, Eduardo García Ruíz, Luis Alonso Suárez del Real Tostado and Lucca Edelmann Alonso.

Davis Polk advised the initial purchasers with a corporate team included partner Maurice Blanco, counsel Katia Brener and associate Ernesto Talamás Velázquez. Partner Simon Witty and counsel John Taylor provided English law advice. Partners Po Sit and Jonathan Cooklin, counsel Dominic Foulkes and associates Ben Levenback and Freddie Schwier provided U.S. and English tax advice.

In Mexico, Creel, García-Cuéllar, Aiza y Enríquez advised the initial purchasers with Carlos Zamarrón, Carlos Aiza H., Jorge Correa Cervera, Andrés Barroso Torres, Juan Pablo Sánchez Cobo, Fernanda Cid, Laura Repila Saiz and Ivonne Montaño Sanluis.

Involved fees earner: Ethan Back – Cleary Gottlieb Steen & Hamilton; Michael Eis – Cleary Gottlieb Steen & Hamilton; Jorge Juantorena – Cleary Gottlieb Steen & Hamilton; Isa Julson Barahona – Cleary Gottlieb Steen & Hamilton; Marc Rotter – Cleary Gottlieb Steen & Hamilton; Manuel Silva – Cleary Gottlieb Steen & Hamilton; David Stewart Fisher – Cleary Gottlieb Steen & Hamilton; Richard Sultman – Cleary Gottlieb Steen & Hamilton; Carlos Aiza – Creel, García-Cuéllar, Aiza y Enriquez SC; Andrés Barroso Torres – Creel, García-Cuéllar, Aiza y Enriquez SC; Fernanda Cid – Creel, García-Cuéllar, Aiza y Enriquez SC; Jorge Correa Cervera – Creel, García-Cuéllar, Aiza y Enriquez SC; Ivonne Montaño – Creel, García-Cuéllar, Aiza y Enriquez SC; Laura Repila – Creel, García-Cuéllar, Aiza y Enriquez SC; Juan Pabló Sánchez Cobo – Creel, García-Cuéllar, Aiza y Enriquez SC; Carlos Zamarrón – Creel, García-Cuéllar, Aiza y Enriquez SC; Maurice Blanco – Davis Polk & Wardwell; Katia Brener – Davis Polk & Wardwell; Jonathan Cooklin – Davis Polk & Wardwell; Dominic Foulkes – Davis Polk & Wardwell; Ben Levenback – Davis Polk & Wardwell; Po Sit – Davis Polk & Wardwell; John Taylor – Davis Polk & Wardwell; Ernesto Talamás Velázquez – Davis Polk & Wardwell; Simon Witty – Davis Polk & Wardwell; Freddie Schwier – Freshfields Bruckhaus Deringer LLP; Lucca Edelmann Alonso – Ritch, Mueller, Heather y Nicolau, SC; Eduardo García Ruíz – Ritch, Mueller, Heather y Nicolau, SC; Oscar López Velarde – Ritch, Mueller, Heather y Nicolau, SC; Luis Nicolau Gutiérrez – Ritch, Mueller, Heather y Nicolau, SC; Joshua Párraga Saggiante – Ritch, Mueller, Heather y Nicolau, SC; Luis Alonso Suárez del Real Tostado – Ritch, Mueller, Heather y Nicolau, SC; Charlotte Courtney – Travers Smith; Aimee Hutchinson – Travers Smith; Jon Reddington – Travers Smith; Simon Skinner – Travers Smith;

Law Firms: Cleary Gottlieb Steen & Hamilton; Creel, García-Cuéllar, Aiza y Enriquez SC; Davis Polk & Wardwell; Freshfields Bruckhaus Deringer LLP; Ritch, Mueller, Heather y Nicolau, SC; Travers Smith;

Clients: Citigroup Inc.; Fresnillo; J.P. Morgan Securities LLC; Santander;

Author: Ambrogio Visconti