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Burlington Northern Issues $1.5 Billion of Bonds in Two Parts

Burlington Northern Santa Fe LLC issued $1.5 billion in a two-part bond sale, its first offering in five months.

The railroad that Warren Buffett’s Berkshire Hathaway Inc. (BRK/A) bought in 2010 sold $800 million of 3.85 percent, 10-year notes that yield 117 basis points more than similar-maturity Treasuries and $700 million of 5.15 percent, 30-year securities at 140 basis points more than benchmarks, according to data compiled by Bloomberg.

The Fort Worth, Texas-based company’s bonds may be rated A3 by Moody’s Investors Service, the data show. Proceeds from the sale will be used for general corporate purposes, which may include capital expenditures and debt repayment, the company said in a regulatory filing today.

BNSF raised $1.5 billion in March with a sale that included $700 million of 3 percent notes maturing in 2023. Those debentures traded at 95.2 cents on the dollar to yield 3.6 percent on Aug. 9, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

Bank of America Corp., Citigroup Inc. and Goldman Sachs Group Inc. managed today’s sale, Bloomberg data show.

To contact the reporter on this story: Scott Harrison in New York at sharrison52@bloomberg.net

To contact the editor responsible for this story: Alan Goldstein at agoldstein5@bloomberg.net

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