Kansas City Southern sets price talk for $175 million 13% notes with OID to yield 16½% to 16¾%

By Paul A. Harris

St. Louis, Dec. 15 - Kansas City Southern Railway Co. launched $175 million of five-year senior unsecured notes (expected ratings B2/BB-) on Monday morning in a widely expected quick-to-market deal.

Subsequently price talk emerged setting a 13% coupon with an original discount expected to result in a yield of between 16½% to 16¾%, according to an informed source.

Books were set to close at 2:45 p.m. ET Monday, with pricing to follow.

The deal was priced, an informed source told Prospect News late Monday evening, however no terms were available at press time.

Morgan Stanley is left bookrunner for the notes which are registered with the Securities and Exchange Commission. Banc of America Securities is the joint bookrunner. Scotia Capital is joint lead manager. BMO Capital Markets and SunTrust Securities are co-managers.

The notes come with three years of call protection.

Proceeds along with other borrowings will be used to repay the company's 7½% senior notes due 2009.

The prospective issuer is a Kansas City, Mo.-based rail freight company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.