Shares of FMG are flat after the company announced a refinancing package which will lower their annual borrowing costs by more than US$130 million per year.
The package is in the form of US$ 500 million of senior unsecured notes at 5.125%.
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This is a significant improvement to FMG’s capital structure, reflects confidence from senior management, and should give the share price a boost over the near-term.
FMG is part of our ASX Top 50 model portfolio and our ALGO engine triggered a buy signal at $4.70 on May 15th.
We prefer the long side of FMG from $5.00 and suggest that inventors add the stock to their portfolio holdings.
Fortescue Metals Group
