MRC Global Inc. Announces Intention To Enter Into New $650 Million Term Loan And To Redeem 9.50% Senior Secured Notes Due 2016

 MRC Global Inc. Announces Intention To Enter Into New $650 Million Term Loan
              And To Redeem 9.50% Senior Secured Notes Due 2016

PR Newswire

HOUSTON, Oct. 24, 2012

HOUSTON, Oct. 24, 2012 /PRNewswire/ -- MRC Global Inc. (NYSE:MRC) announced
today that its loan arrangers have received preliminary commitments from
interested lenders and that they have allocated participations based on these
commitments for the company to enter into a new $650 million seven-year senior
secured Term Loan B. The company expects to use the proceeds of the new term
loan, together with a draw under the company's global asset-based lending
(ABL) facility, to redeem all of the $861 million in outstanding 9.50% Senior
Secured Notes due 2016 of McJunkin Red Man Corporation, a wholly owned
subsidiary of the company.

New Term Loan B

The company would have the option under the term loan to pay interest at a
base rate, subject to a floor of 2.25%, plus an applicable margin, or at a
rate based on LIBOR, subject to a floor of 1.25%, plus an applicable margin.
The applicable margin for base rate loans at closing is expected to be 400
basis points and the applicable margin for LIBOR loans is expected to be 500
basis points.The margin is expected to step down by 25 basis points if the
company's consolidated total leverage ratio (as defined in the term loan) is
less than 2.50:1.00. At the closing of the term loan, the interest rate is
expected to be equal to 6.25%, as compared to an interest rate of 9.50% on the

During the nine months ended September 30, 2012, the company purchased in the
open market $188.7 million in aggregate principal amount of the notes for
$205.0 million. These purchases were funded from borrowings under the
company's global ABL facility. The company expects to reduce its interest
expense by over $50 million per year as a result of these purchases and the
redemption of the notes, assuming the company's current debt levels, the
anticipated initial interest rate under the term loan of 6.25% and current
interest rates under the company's global ABL facility.

MRC Global expects to record a charge upon the completion of the redemption of
the notes of approximately $93million, including the write off of original
issue discount and debt issuance costs on the redeemed notes and for the
applicable redemption premium.

The company expects that the term loan would be secured by a first lien on all
of the company's assets, the assets of all of the company's domestic
subsidiaries and a pledge of all of the capital stock of the company's
domestic subsidiaries and 65% of the capital stock of the company's first tier
foreign subsidiaries, subject to certain exceptions, other than the assets
securing the ABL facility (which include the company's accounts receivable,
inventory and related assets), and by a second lien on this ABL collateral.

The closing and funding of the term loan will be subject to our fulfillment of
various conditions, including entering into definitive documentation with the
lenders, delivery of customary closing documents and legal opinions and
delivery of proper collateral satisfactory to the lenders. Although the
arrangers of the term loan have informed the company that they have received
preliminary commitments from interested lenders and that they have allocated
participations in the term loan based on these commitments, there is no
assurance that the arrangers of the term loan and their syndicate participants
would not require the fulfillment of other conditions or that changes in the
term loan terms and pricing would not be required as a result of changes in
the term loan market or the financial markets generally or our financial
results or condition or future prospects or other factors.

Notification of Call for Redemption of Senior Secured Notes

The company also announced today that McJunkin Red Man is notifying the
registered holders of the senior secured notes that it has called for
redemption on November 9, 2012, $861,319,000 in principal amount of the notes,
which represents all of the notes currently outstanding.

In accordance with the indenture governing the notes, each $1,000 principal
amount of the notes will be redeemed at a price equal to 100% of the principal
amount, plus the Applicable Premium (as defined in the indenture governing the
notes), and accrued and unpaid interest to the date of redemption. The
redemption price will be due and payable on the date of redemption upon
surrender of the notes. A notice of redemption containing information
required by the terms of the indenture governing the notes will be distributed
by U.S. Bank National Association, the trustee under the indenture governing
the notes. Questions regarding the redemption should be directed to U.S. Bank
National Association by telephone at (651) 495-8097.

The redemption is expressly conditioned upon the following:

  oThe company's entry into the term loan in an amount of at least
    $650million upon such terms and conditions as are satisfactory to the
  oThe company's receipt of at least $650 million (less applicable fees,
    expenses and other amounts) pursuant to the term loan, and
  oThe company's borrowing of sufficient funds under the global ABL facility
    such that, combined with the proceeds of the term loan and cash on hand,
    McJunkin Red Man has sufficient funds to redeem the notes.

McJunkin Red Man may revoke the notice of redemption prior to the date of
redemption if these conditions are not satisfied.

In connection with the redemption of the notes and the entry into the term
loan, the company also intends to amend its existing global ABL facility. The
amendment of the facility is subject to the company's fulfillment of various
conditions, including, among other things, the funding of the term loan.

About MRC Global Inc. – Global Supplier of Choice^®

Headquartered in Houston, Texas, MRC, a Fortune 500 company, is the largest
global distributor of pipe, valve, and fittings (PVF) and related products and
services to the energy industry, based on sales, and supplies these products
and services across each of the upstream, midstream and downstream sectors.
More information on MRC can be found on our website at

Not a Notice of Redemption

This press release is for informational purposes only and is neither an offer
to purchase nor a solicitation of an offer to sell McJunkin Red Man
Corporation's 9.50% Senior Secured Notes due 2016. This press release does
not constitute a notice of redemption pursuant to the indenture governing the

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of
Section27A of the Securities Act and Section21E of the Exchange Act. Words
such as "will," "expects," "expected", "would", "anticipate", "intends" and
similar expressions are intended to identify forward-looking statements.

Despite the company's expectations of entering into a new term loan, the terms
and pricing of a term loan, the entering into a global ABL facility amendment,
the terms of the amendment and the use of proceeds to refinance its existing
senior secured notes are only the company's expectations regarding these
actions. Whether the company is actually successful in obtaining such a term
loan and global ABL amendment on expected terms and conditions with expected
uses of proceeds is dependent on a number of factors, including (among others)
debt market conditions, reaching final agreement with lenders and the
company's financial condition, results and future prospects, which, in turn
are dependent on factors, including (among others) those that impact our

Statements about the company's business, including its strategy, its industry,
the company's future profitability, growth in the company's various markets
and the company's expectations, beliefs, plans, strategies, objectives,
prospects and assumptions are not guarantees of future performance. These
statements involve known and unknown risks, uncertainties and other factors
that may cause the company's actual results and performance to be materially
different from any future results or performance expressed or implied by these
forward-looking statements. These risks and uncertainties include (among
others) decreases in oil and natural gas industry expenditure levels, which
may result from decreased oil and natural gas prices or other factors;
increased usage of alternative fuels, which may negatively affect oil and
natural gas industry expenditure levels; U.S.and international general
economic conditions; the company's ability to compete successfully with other
companies in the company's industry; the risk that manufacturers of the
products the company distributes will sell a substantial amount of goods
directly to end users in the industries it serves; unexpected supply
shortages; cost increases by the company's suppliers; the company's lack of
long-term contracts with most of its suppliers; increases in customer,
manufacturer and distributor inventory levels; suppliers' price reductions of
products that the company sells, which could cause the value of its inventory
to decline; decreases in steel prices, which could significantly lower the
company's profit; increases in steel prices, which it may be unable to pass
along to its customers, which could significantly lower its profit; the
company's lack of long-term contracts with many of its customers and its lack
of contracts with customers that require minimum purchase volumes; changes in
the company's customer and product mix; risks related to the company's
customers' credit; the potential adverse effects associated with integrating
acquisitions into the company's business and whether these acquisitions will
yield their intended benefits; the success of the company's acquisition
strategies; the company's significant indebtedness; the dependence on the
company's subsidiaries for cash to meet its debt obligations; changes in the
company's credit profile; a decline in demand for certain of the products that
the company distributes if import restrictions on these products are lifted;
environmental, health and safety laws and regulations; the sufficiency of the
company's insurance policies to cover losses, including liabilities arising
from litigation; product liability claims against the company; pending or
future asbestos-related claims against the company; the potential loss of key
personnel; interruption in the proper functioning of the company's information
systems; loss of third-party transportation providers; potential inability to
obtain necessary capital; risks related to adverse weather events or natural
disasters; impairment of the company's goodwill or other intangible assets;
changes in tax laws or adverse positions taken by taxing authorities in the
countries in which the company operates; and adverse changes in political or
economic conditions in the countries in which the company operates.For a
discussion of key risk factors, please see the risk factors disclosed in the
company's SEC filings, which are available on the SEC's website at
and on the company's website,

Undue reliance should not be placed on the company's forward-looking
statements. Although forward-looking statements reflect the company's good
faith beliefs, reliance should not be placed on forward-looking statements
because they involve known and unknown risks, uncertainties and other factors,
which may cause the company's actual results, performance or achievements or
future events to differ materially from anticipated future results,
performance or achievements or future events expressed or implied by such
forward-looking statements. The company undertakes no obligation to publicly
update or revise any forward-looking statement, whether as a result of new
information, future events, changed circumstances or otherwise, except to the
extent required by law.


James E. Braun, Chief Financial Officer
MRC Global Inc.

Ken Dennard, Managing Partner

SOURCE MRC Global Inc.
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