Canadian Pacific buys back $475 million of notes in tender offer

By Angela McDaniels

Tacoma, Wash., June 11 - Canadian Pacific Railway Ltd. said its wholly owned subsidiary, Canadian Pacific Railway Co., purchased $475 million principal amount of notes in a tender offer that expired at midnight ET on June 10.

The company offered to buy up to all of its $400 million of 6.25% notes due Oct. 15, 2011, up to all of its $400 million of 5.75% notes due May 15, 2013, up to $75 million of the $300 million of 6.5% notes due 2018 and no more than $475 million of notes in total. The notes are listed in order of acceptance priority level.

Holders tendered $154.25 million of the 6.25% notes, $298.58 million of the 5.75% notes and $93,138,000 of the 6.5% notes. The company accepted all of the 6.25% notes and 5.75% notes and $22.17 million of the 6.5% notes.

The proration factor for the 6.5% notes is 23.846%.

For each $1,000 principal amount, the company will pay $1,035 for the 6.25% notes, $1,040 for the 5.75% notes and $985 for the 6.5% notes. The total payment includes a $30 premium for each note tendered by the early tender date, 5 p.m. ET on May 27.

Holders will also receive accrued interest.

The offer began on May 12. On May 28, the company raised the cap to $475 million from $400 million.

J.P. Morgan Securities Inc. (866 834-4666 or call collect 212 834-4666) and Morgan Stanley & Co. Inc. (800 624-1808 or call collect 212 761-5384) were the dealer managers. Global Bondholder Services Corp. (866 470-3900 or call collect 212 430-3774) was the information agent.

The railway is based in Calgary, Alta.

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