By Devika Patel
Knoxville, Tenn., May 1 – Kansas City Southern offered further details about a $500 million sale of 4.7% 30-year guaranteed senior notes (Baa3/BBB-/BBB) that priced on Monday at a spread of Treasuries plus 160 basis points, on the wide side of guidance, according to an FWP filed with the Securities and Exchange Commission.
The bonds priced at 99.888 to yield 4.707%.
The bookrunners were BofA Merrill Lynch, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC.
The notes are guaranteed by certain of Kansas City Southern’s domestic subsidiaries.
Proceeds will be used to repay commercial paper, to refinance a locomotive lease and certain equipment loans and for general corporate purposes.
The rail transportation holding company for Kansas City Southern Railway Co. is based in Kansas City, Mo.
| Issuer: | Kansas City Southern
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| Guarantors: | Certain Kansas City Southern domestic subsidiaries
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| Amount: | $500 million
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| Description: | Senior notes
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| Maturity: | May 1, 2048
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| Bookrunners: | BofA Merrill Lynch, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC
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| Senior co-managers: | Citigroup Global Markets Inc. and U.S. Bancorp Investments Inc.
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| Co-manager: | SunTrust Robinson Humphrey Inc.
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| Coupon: | 4.7%
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| Price: | 99.888
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| Yield: | 4.707%
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| Spread: | Treasuries plus 160 bps
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| Call: | Make-whole call at Treasuries plus 25 bps until Nov. 1, 2047, then a par call
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| Trade date: | April 30
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| Settlement date: | May 3
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| Ratings: | Moody’s: Baa3
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| S&P: BBB-
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| Fitch: BBB
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| Distribution: | SEC registered
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| Price guidance: | Treasuries plus 160 bps area, plus or minus 2 bps
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