CALGARY, Nov. 28, 2011 /CNW/ - Canadian Pacific Railway Limited (TSX:
CP)(NYSE: CP) announced today that its wholly- owned subsidiary,
Canadian Pacific Railway Company, is commencing an offering of senior
unsecured notes in the United States to fund a voluntary prepayment in
2011 to the company's Canadian defined benefit pension plan.
The offering is being made in the United States under the base shelf
prospectus dated June 29, 2011 which allows for offerings of up to US
$1.5 billion of debt securities. The issue size of the offering and
its maturity, interest rate and net proceeds have not yet been
CP believes that the transactions will be a tax efficient means for the
company to reduce the volatility in defined benefit pension plan
funding requirements and provide greater flexibility to direct future
cash from operations to infrastructure investments. The net impact of
the debt offering and the voluntary prepayment of the pension
contribution is expected to be accretive to earnings.
CP intends to access debt markets, other than the U.S. public market, to
fund additional voluntary prepayments of future contributions to its
Canadian defined benefit pension plan. Any additional debt offerings
will depend on capital market conditions and may occur at any time.
There is no assurance that any additional debt offerings will be
Canadian Pacific Railway Company has filed a registration statement
(including a prospectus) with the United States Securities and Exchange
Commission ("SEC") for the U.S. offering to which this communication
relates. Before you invest, you should read the prospectus in that
registration statement and other documents the issuer has filed with
the SEC for more complete information about the issuer and this
offering. You may get these documents for free by visiting EDGAR on the
SEC Website at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating
in the offering will arrange to send you the prospectus if you request
it by calling J.P. Morgan Securities LLC collect at 1-212-834-4533.
Note on forward-looking information
This news release contains certain forward-looking statements relating
but not limited to the size and timing of future defined benefit
pension plan contributions and future earnings. Undue reliance should
not be placed on forward-looking information as actual results may
By its nature, CP's forward-looking information involves numerous
assumptions, inherent risks and uncertainties, including but not
limited to the following factors: changes in laws and regulations;
changes in taxes and tax rates; and effects of changes in market
conditions and discount rates on the financial position of pension
plans and investments.
Except as required by law, CP undertakes no obligation to update
publicly or otherwise revise any forward-looking information, whether
as a result of new information, future events or otherwise.
About Canadian Pacific
Canadian Pacific (CP: TSX)(NYSE: CP) operates a North American
transcontinental railway providing freight transportation services,
logistics solutions and supply chain expertise. Incorporating
best-in-class technology and environmental practices, CP is re-defining
itself as a modern 21st century transportation company built on safety,
service reliability and operational efficiency. Visit cpr.ca and see how Canadian Pacific is Driving the Digital Railway.
SOURCE Canadian Pacific
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