Copyright 2010 SNL Financial LCAll Rights Reserved SNL Insurance Daily
February 5, 2010 Friday
Berkshire files for $8B debt offering to help pay BNSF shareholders
Berkshire Hathaway said the net proceeds would provide some of the cash consideration in its acquisition of Burlington Northern Santa Fe.
Berkshire Hathaway Inc. filed for an $8 billion debt offering Feb. 4, saying it would issue senior notes due in 2011, 2012, 2013 and 2015.
According to a preliminary prospectus supplement, J.P. Morgan Securities Inc. is serving as the sole book-running manager, and Wells Fargo Securities LLC is the joint lead manager. The company said it would use the net proceeds from the sale of the notes as part of the cash consideration to be paid to stockholders of Burlington Northern Santa Fe Corp. as part of its acquisition of the railroad.
On Feb. 4, Standard & Poor’s Ratings Services downgraded the long-term counterparty credit rating of Berkshire to AA+ from AAA. The rating agency said the action stems from concerns about the Burlington Northern acquisition and the “view that Berkshire’s overall capital adequacy, as well as that of its insurance operations, has weakened to levels no longer consistent with a ‘AAA’ rating and is not expected to return to extremely strong levels in the near term.”
February 11, 2010