CALGARY — Canadian Pacific Railway said its wholly owned subsidiary, Canadian Pacific Railway Co., is issuing $350 million of 4.45 percent notes due March 15, 2023.
The transaction is expected to close Sept. 23, 2010.
The debt offering is being made in the United States under the base shelf prospectus dated June 26, 2009 which allowed for offerings of up to $1.5 billion of debt securities.
The net proceeds from this offering of approximately $346 million, combined with general corporate funds, will be used for a voluntary prepayment in 2010 of up to CDN $650 million to the company’s defined benefit pension plans.
CP’s estimated 2010 contributions to its defined benefit pension plans will be between $185 to $195 million before this prepayment and up to $845 million after the prepayment.