Suncor Energy Inc. reports that it has arranged for the issuance of US$1.25 billion in principal amount of senior unsecured notes maturing on June 1, 2018 (the “2018 Notes”) and US$750 million in principal amount of senior unsecured notes maturing on June 1, 2039 (the “2039 Notes”, and collectively with the 2018 Notes, the “Notes”). The 2018 Notes will have a coupon of 6.100% and be priced at 99.883% of par to yield 6.116%. The 2039 Notes will have a coupon of 6.850% and be priced at 99.416% of par to yield 6.896%. Suncor intends to add the net proceeds from the sale of the Notes to its general funds, and to use such funds for its working capital needs, sustaining and growth capital expenditures, and to repay outstanding commercial paper borrowings. Pending any such use of proceeds, Suncor expects to invest such proceeds in short-term money market instruments. Closing is scheduled for June 6, 2008.
The Notes are expected to be assigned a rating of “A- (negative)” by Standard & Poor’s Rating Service (S&P) and “A3 (stable)” by Moody’s Investors Service, Inc.
The sale of the Notes will be completed under Suncor's shelf prospectus dated February 20, 2007, as amended by Amendment No. 1 thereto dated May 28, 2008, and its prospectus supplement dated June 3, 2008. The offering was led by Bank of America Securities LLC, Morgan Stanley, BNP Paribas and RBC Capital Markets as joint book-running managers.