Yahoo Finance GrafTech Explores Options for Raising Money as Losses Mount
(Bloomberg) -- GrafTech International, a manufacturer of graphite electrodes used in steel production, is exploring options for raising new money, according to people with knowledge of the matter.
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The company is working with Evercore Inc., which has been reaching out to opportunistic funds about providing fresh financing, said the people, who asked not to be named as the details are private. Options under consideration include transferring assets to a different subsidiary and borrowing against them, the people said.
Conversations are preliminary and details may change, according to the people.
GrafTech may use part of the proceeds to buy back debt, the people said. Some bondholders have banded together and tapped PJT Partners for advice, they added.
Spokespeople for the company and Evercore didn’t respond to requests for comment. A representative for PJT declined to comment.
High Yield
The manufacturer has about $950 million in secured bonds due 2028, according to data compiled by Bloomberg. The company’s 9.875% notes changed hands for about 78 cents this week to yield nearly 17%, according to pricing source Trace.
Moody’s Ratings slashed GrafTech’s credit grade deeper into junk late last year, citing its reliance on a single product for much of its revenue and the cyclical nature of the steel industry. It said the company has suffered from diminished demand and called its credit metrics “very weak.”
GraftTech’s operations burnt cash in the first quarter of 2024, adding to a net loss of $30.9 million for the period. The publicly traded company was profitable on a net income basis as recently as the fourth quarter of 2022, according to data compiled by Bloomberg.
Ohio-based GrafTech appointed a new chief executive officer in March, according to a statement.
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