THE Canadian Pacific Railway (CP) raised US$8.45 billion after selling investment-grade bonds in US and Canadian dollars to help fund its acquisition of Kansas City Southern, reports Bloomberg.
The railway priced $6.7 billion of US dollar bonds in five parts and sold C$2.2 billion (US$1.74 billion) notes in two parts.
Canadian Pacific won a buyout war for Kansas City Southern in September, agreeing to acquire the US-based railway in a $27 billion cash and stock transaction that will create the first railway to operate in the US, Canada, and Mexico.
'It appears that market timing works well for them because current level of rates and tight spreads will keep their cost of capital quite low,' said Fiera Capital senior portfolio manager Imran Chaudhry.
'CP needs to raise money to pay the Kansas City Southern shareholders as soon as possible.'
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The railway priced $6.7 billion of US dollar bonds in five parts and sold C$2.2 billion (US$1.74 billion) notes in two parts.
Canadian Pacific won a buyout war for Kansas City Southern in September, agreeing to acquire the US-based railway in a $27 billion cash and stock transaction that will create the first railway to operate in the US, Canada, and Mexico.
'It appears that market timing works well for them because current level of rates and tight spreads will keep their cost of capital quite low,' said Fiera Capital senior portfolio manager Imran Chaudhry.
'CP needs to raise money to pay the Kansas City Southern shareholders as soon as possible.'
SeaNews Turkey
