Nov 24 (Reuters) - Gerdau Ameristeel Corp said its unit would borrow $610 million from Gerdau Holdings Inc, a unit of Gerdau SA, on arm's length terms to prepay debt.
The loan, which is expected to be funded on Dec. 3, will be a senior, unsecured obligation, bearing interest at 7.95 percent per annum, the mini-mill steel producer said in a statement.
The loan will mature in full on Jan. 20, 2020 and will have no scheduled principal payments prior to maturity, Gerdau said, adding, interest will be payable semi-annually, starting on July 20, 2010.
The amount borrowed represents about 50 percent of the proceeds of the $1.25 billion of bonds issued by Gerdau Holdings Inc on Nov. 18.
Gerdau Ameristeel plans to retire $510 million of its outstanding Tranche A term debt and $100 million of its outstanding Tranche C term debt.
Shares of the company closed at C$8.76 Tuesday on the Toronto Stock Exchange.

(Reporting by Koustav Samanta in Bangalore; Editing by Gopakumar Warrier) Keywords: GERDAUAMERISTEEL/ (koustav.samanta@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800; Reuters Messaging: koustav.samanta.reuters.com@reuters.net)

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