FedEx Corp. has issued $2 billion in notes to fund repayment of debt and share repurchase programs.
The notes included $750 million paying 3.25% interest that are due in 2026, and $1.25 billion paying 4.55% interest that are due in 2046.
The company that ranks No. 2 on the Transport Topics Top 100 list of the largest U.S. and Canadian for-hire carriers disclosed the sale in a March 24 Securities and Exchange Commission filing.
The SEC filing noted that the funds will be used for general corporate purposes. A FedEx spokesman told Transport Topics a portion of the funds will be used for “the redemption or the prepayment and defeasance of the underlying debt of certain leveraged operating leases”.
FedEx also is planning a second debt offering later this year to pay part of the cost of acquiring TNT N.V. That $4.9 billion acquisition, announced in April of last year, is in the final stages of review in three countries, after approvals that have been obtained by more than 20 other nations, including the United States.
FedEx intends to launch a second note offering to pay part of the acquisition of the Netherlands-based company soon after the March 24 note sale is completed.
The Memphis, Tennessee-based company anticipates completing the acquisition of TNT in the first half of the year. The balance of the purchase price of 9 euros ($10) per share will come from cash generated by FedEx operations.