KCS Announces Exchange Offers & Consent Solicitations Final Results for $2.125 Billion of Senior Notes, Entry into New Credit...
December 09 2015 - 11:44AM
Business Wire
Approximately 96% of Total Outstanding
Senior Notes Tendered
Kansas City Southern (“KCS”) (NYSE: KSU) announced today the
expiration and final results of the previously announced exchange
offers (the “Exchange Offers”) for any and all outstanding notes of
the series set forth on the table below issued by its wholly-owned
subsidiaries (i) The Kansas City Southern Railway Company
(“KCSR”) and (ii) Kansas City Southern de México, S.A. de C.V.
(“KCSM”) (collectively, the “Existing Notes”) and the related
consent solicitations (the “Consent Solicitations”). The Consent
Solicitations sought consents (the “Consents”) on behalf of KCSR or
KCSM, as applicable, from each Eligible Holder (as defined below)
of the Existing Notes relating to certain proposed amendments (the
“Proposed Amendments”) to the indentures governing the Existing
Notes (collectively, the “Existing Indentures”). The results of the
Exchange Offers and Consent Solicitations as of 11:59 p.m., New
York City time, on December 8, 2015 (the “Expiration Date”), are as
follows:
Issuer of Notes tobe
Exchanged
Series of Notes to
beExchanged
Principal
AmountOutstanding($mm)
CUSIP No.
Principal Amount ofExisting
Notes Exchanged($mm)
Approximate Percentageof
Existing NotesExchanged
KCSR 3.85% Senior Notes due 2023 $200.0 485188 AM8 $195.0 97.5%
KCSR 4.30% Senior Notes due 2043 $450.0 485188 AN6 $437.6
97.2% KCSR 4.95% Senior Notes due 2045 $500.0 485188 AP1
$476.7 95.3% KCSM Floating Rate Senior Notes due 2016 $250.0
485161 AU7 $244.8 97.9% KCSM 2.35% Senior Notes due 2020
$275.0 485161 AQ6 $239.6 87.1% KCSM 3.00%
Senior Notes due 2023 $450.0 485161 AS2
$439.1 97.6% TOTAL $2,125.0 $2,032.8
95.7%
On December 9, 2015, KCS accepted for purchase, and paid the
applicable consideration for, all Existing Notes that were validly
tendered (and not validly withdrawn) in the Exchange Offers on or
prior to the Expiration Date, plus accrued and unpaid interest. The
consummation of the Exchange Offers and Consent Solicitations was
subject to and conditional upon, among other things, KCS entering
into a new $800.0 million revolving credit facility (the “KCS
Revolving Credit Facility”), which occurred on December 9, 2015.
The KCS Revolving Credit Facility, in turn, is expected to be used
primarily to support issuance of commercial paper by KCS under a
new $800.0 million commercial paper program entered into on
December 9, 2015.
The Exchange Offers and Consent Solicitations were made, and the
KCS Notes were offered and issued, only (a) in the United States to
holders of Existing Notes who are “qualified institutional buyers”
(as defined in Rule 144A under the Securities Act of 1933, as
amended (the “Securities Act”)) and (b) outside the United
States to holders of Existing Notes who are persons other than U.S.
persons in reliance upon Regulation S under the Securities Act
(collectively, “Eligible Holders”).
KCS retained D.F. King & Co., Inc. to serve as the
information agent and exchange agent for the Exchange Offers and
Consent Solicitations.
The KCS Notes have not been registered under the Securities Act,
or any state securities laws, and may not be offered or sold in the
United States absent registration or an applicable exemption from
registration requirements, and will therefore be subject to
substantial restrictions on transfer. KCS and the guarantors have
entered into a registration rights agreement with respect to the
KCS Notes and the note guarantees. This press release is for
informational purposes only and is not an offer to purchase, a
solicitation of an offer to purchase or a solicitation of consents
with respect to, any securities.
Headquartered in Kansas City, Mo., KCS is a transportation
holding company that has railroad investments in the U.S., Mexico
and Panama. Its primary U.S. holding is KCSR, serving the central
and south central U.S. Its international holdings include KCSM,
serving northeastern and central Mexico and the port cities of
Lázaro Cárdenas, Tampico and Veracruz, and a 50 percent interest in
Panama Canal Railway Company, providing ocean-to-ocean freight and
passenger service along the Panama Canal. KCS’s North American rail
holdings and strategic alliances are primary components of a NAFTA
Railway system, linking the commercial and industrial centers of
the U.S., Mexico and Canada.
This news release contains “forward-looking statements” within
the meaning of the securities laws concerning potential future
events involving KCS and its subsidiaries, which could materially
differ from the events that actually occur. Words such as
“projects,” “estimates,” “forecasts,” “believes,” “intends,”
“expects,” “anticipates,” and similar expressions are intended to
identify many of these forward-looking statements. Such
forward-looking statements are based upon information currently
available to management and management’s perception thereof as of
the date hereof. Differences that actually occur could be caused by
a number of external factors over which management has little or no
control, including: competition and consolidation within the
transportation industry; the business environment in industries
that produce and use items shipped by rail; loss of the rail
concession of KCS’ subsidiary, KCSM; the termination of, or failure
to renew, agreements with customers, other railroads and third
parties; interest rates; access to capital; disruptions to KCS’
technology infrastructure, including its computer systems; natural
events such as severe weather, hurricanes and floods; market and
regulatory responses to climate change; credit risk of customers
and counterparties and their failure to meet their financial
obligations; legislative and regulatory developments and disputes;
rail accidents or other incidents or accidents on KCS’ rail network
or at KCS’ facilities or customer facilities involving the release
of hazardous materials, including toxic inhalation hazards;
fluctuation in prices or availability of key materials, in
particular diesel fuel; dependency on certain key suppliers of core
rail equipment; changes in securities and capital markets;
availability of qualified personnel; labor difficulties, including
strikes and work stoppages; insufficiency of insurance to cover
lost revenue, profits or other damages; acts of terrorism or risk
of terrorist activities; war or risk of war; domestic and
international economic conditions; political and economic
conditions in Mexico and the level of trade between the United
States and Mexico; increased demand and traffic congestion; the
outcome of claims and litigation involving KCS or its subsidiaries;
and other factors affecting the operation of the business. More
detailed information about factors that could affect future events
may be found in filings by KCS with the Securities and Exchange
Commission, including KCS’ Annual Report on Form 10-K for the year
ended December 31, 2014 (File No. 1-4717) and subsequent reports.
Forward-looking statements are not, and should not be relied upon
as, a guarantee of future performance or results, nor will they
necessarily prove to be accurate indications of the times at or by
which any such performance or results will be achieved. As a
result, actual outcomes and results may differ materially from
those expressed in forward-looking statements. KCS is not obligated
to update any forward-looking statements to reflect future events
or developments.
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version on businesswire.com: http://www.businesswire.com/news/home/20151209006119/en/
Kansas City SouthernWilliam H. Galligan,
816-983-1551bgalligan@kcsouthern.com
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