KCS Announces Registered Exchange Offers for $2.088 Billion of Senior Notes
June 27 2016 - 05:39PM
Business Wire
Kansas City Southern (“KCS”) (NYSE: KSU) announced today that it
has commenced registered exchange offers (the “Exchange Offers”)
of:
- $244,820,000 in aggregate principal
amount of its Floating Rate Senior Notes due 2016 (the “2016
Exchange Notes”), registered under the Securities Act of 1933, as
amended (the “Securities Act”), for any and all of its outstanding
unregistered Floating Rate Senior Notes due 2016 (the “Outstanding
2016 Notes”);
- $257,346,000 in aggregate principal
amount of its 2.35% Senior Notes due 2020 (the “2020 Exchange
Notes”), registered under the Securities Act, for any and all of
its outstanding unregistered 2.35% Senior Notes due 2020 (the
“Outstanding 2020 Notes”);
- $439,123,000 in aggregate principal
amount of its 3.00% Senior Notes due 2023 (the “3.00% 2023 Exchange
Notes”), registered under the Securities Act, for any and all of
its outstanding unregistered 3.00% Senior Notes due 2023 (the
“Outstanding 3.00% 2023 Notes”);
- $199,224,000 in aggregate principal
amount of its 3.85% Senior Notes due 2023 (the “3.85% 2023 Exchange
Notes”), registered under the Securities Act, for any and all of
its outstanding unregistered 3.85% Senior Notes due 2023 (the
“Outstanding 3.85% 2023 Notes”);
- $448,651,000 in aggregate principal
amount of its 4.30% Senior Notes due 2043 (the “2043 Exchange
Notes”), registered under the Securities Act, for any and all of
its outstanding unregistered 4.30% Senior Notes due 2043 (the
“Outstanding 2043 Notes”); and
- $499,165,000 in aggregate principal
amount of its 4.95% Senior Notes due 2045 (the “2045 Exchange
Notes” and, together with the 2016 Exchange Notes, the 2020
Exchange Notes, the 3.00% 2023 Exchange Notes, the 3.85% 2023
Exchange Notes and the 2043 Exchange Notes, the “Exchange Notes”),
registered under the Securities Act, for any and all of its
outstanding unregistered 4.95% Senior Notes due 2045 (the
“Outstanding 2045 Notes” and, together with the Outstanding 2016
Notes, the Outstanding 2020 Notes, the Outstanding 3.00% 2023
Notes, the Outstanding 3.85% 2023 Notes and the Outstanding 2043
Notes, the “Outstanding Notes”).
The Outstanding Notes were issued in private offerings pursuant
to Rule 144A and Regulation S under the Securities Act. The
Exchange Offers were commenced in order to satisfy certain
obligations of KCS pursuant to a registration rights agreement
entered into in connection with the private offerings. The terms of
the Exchange Notes are identical in all material respects to the
terms of the corresponding series of Outstanding Notes, except that
the Exchange Notes have been registered under the Securities Act.
KCS will receive no proceeds from the Exchange Offers.
The terms of the Exchange Offers are set forth in the prospectus
dated June 27, 2016 (the “Prospectus”) and the accompanying letter
of transmittal. Each Exchange Offer will expire at 11:59 p.m., New
York City time, on July 25, 2016, unless extended by KCS. Holders
of the Outstanding Notes may obtain copies of the Prospectus and
letter of transmittal from the exchange agent for the Exchange
Offers: U.S. Bank National Association, Corporate Trust Services,
60 Livingston Avenue, St. Paul, Minnesota 55107, Attn: Specialized
Finance, (800) 934-6802 (telephone), (651) 495-8158
(facsimile).
This press release is for informational purposes only and is not
an offer to exchange, or a solicitation of an offer to exchange,
any securities. The Exchange Offers are being made only pursuant to
the Prospectus and the accompanying letter of transmittal and only
to such persons and in such jurisdictions as is permitted under
applicable law. Neither KCS nor the exchange agent makes any
recommendations as to whether holders should tender their
Outstanding Notes in the Exchange Offers. Holders must make their
own decisions as to whether to tender Outstanding Notes and, if so,
the principal amount of Outstanding Notes to tender.
Headquartered in Kansas City, Missouri, KCS is a transportation
holding company that has railroad investments in the U.S., Mexico
and Panama. Its primary U.S. holding is The Kansas City Southern
Railway Company, serving the central and south central U.S. KCS’s
international holdings include Kansas City Southern de México, S.A.
de C.V. (“KCSM”), serving northeastern and central Mexico and the
port cities of Lázaro Cárdenas, Tampico and Veracruz, and a 50
percent interest in the 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: the
outcome of claims and litigation, including those related to
environmental contamination, personal injuries and property damage;
changes in legislation and regulations or revisions of controlling
authority; the adverse impact of any termination or revocation of
KCSM’s Concession by the Mexican government; natural events such as
severe weather, fire, floods, hurricanes, earthquakes or other
disruptions to KCS’s operating systems, structures and equipment or
the ability of customers to produce or deliver their products and
the lack of adequate insurance for such catastrophic losses; United
States, Mexican and global economic, political and social
conditions; the effects of the North American Free Trade Agreement,
or NAFTA, on the level of trade among the United States, Mexico and
Canada; the level of trade between the United States and Asia or
Mexico; the effects of fluctuations in the peso-dollar exchange
rate; the effects of adverse general economic conditions affecting
customer demand and the industries and geographic areas that
produce and consume the commodities KCS carries; the dependence on
the stability, availability and security of the information
technology systems to operate its business; the effect of demand
for KCS’s services exceeding network capacity or traffic congestion
on operating efficiencies and service reliability; uncertainties
regarding the litigation KCS faces and any future claims and
litigation; the impact of competition, including competition from
other rail carriers, trucking companies and maritime shippers in
the United States and Mexico; KCS’s reliance on agreements with
other railroads and third parties to successfully implement its
business strategy, operations and growth and expansion plans,
including the strategy to convert customers from using trucking
services to rail transportation services; compliance with
environmental regulations; disruption in fuel supplies, changes in
fuel prices and KCS’s ability to recapture its costs of fuel from
customers; material adverse changes in economic and industry
conditions, including the availability of short and long-term
financing, both within the United States and Mexico and globally;
market and regulatory responses to climate change; changes in labor
costs and labor difficulties, including strikes and work stoppages
affecting either operations or customers’ abilities to deliver
goods for shipment; KCS’s reliance on certain key suppliers of core
rail equipment; availability of qualified personnel; acts of
terrorism, war or other acts of violence or crime or risk of such
activities; fluctuations in the market price for KCS’s common
stock; 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’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2015 (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/20160627006418/en/
Kansas City SouthernWilliam H. Galligan,
816-983-1551bgalligan@kcsouthern.com
Kansas City Southern (NYSE:KSU)
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