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Buffett’s Burlington Northern Santa Fe Sells $1.25 Billion Bonds

Aug. 16 (Bloomberg) -- Burlington Northern Santa Fe, the railroad that Warren Buffett’s Berkshire Hathaway Inc. bought in 2010, sold $1.25 billion in bonds for general corporate purposes.

Burlington Northern issued $600 million in 3.05 percent, 10-year securities to yield 125 basis points more than similar-maturity Treasuries and $650 million of 4.375 percent, 30-year bonds at 150 basis points more than benchmarks, according to data compiled by Bloomberg. The bonds may be rated A3 by Moody’s Investors Service, its fourth-lowest investment grade and BBB+ by Standard & Poor’s, one level lower, Bloomberg data show.

The railroad operator last sold bonds in February. Its $625 million of 4.4 percent securities due March 2042 traded at 101.3 cents on the dollar for a yield of 4.32 percent yesterday, 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 the sale for the Fort Worth, Texas-based company, Bloomberg data show. A basis point is 0.01 percentage point.

To contact the reporter on this story: Matt Robinson in New York at Mrobinson55@bloomberg.net

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

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