Fitch Affirms KCS at ‘BBB’
Fitch Affirms KCS at ‘BBB’ Written by William C. Vantuono, Editor-in-Chief
Fitch Ratings has affirmed Kansas City Southern’s Long-Term Issuer Default Rating (IDR) and senior unsecured rating at ‘BBB.’ In addition, Fitch has affirmed KCS’s Short-Term IDR and senior unsecured rating at ‘F2.’ Fitch’s Rating Outlook is ‘Stable.’
Fitch said its affirmations “follows KCS’s announcement that it will be acquired by Canadian National (CN) in a transaction valued at $33.7 billion. The announcement comes after KCS had previously agreed to be acquired by Canadian Pacific (CP) for $28.9 billion. The valuation for the transaction is high at more than 20x KCS’s projected 2020 EBITDA. The transaction must be approved by the Surface Transportation Board (STB) and Mexican regulatory bodies before closing. The companies expect the transaction to close in mid-2022. Fitch does not publicly