CPKC’s C$1.8 billion bond sale sets 5.4% on 2056 notes, up from 4.8% in 2025

A new CPKC debt offering comprises C$1.8 billion of Canadian-dollar notes in four series, with the 2056 notes paying 5.40%, up from 4.80% on 2055 notes offered in June 2025.

Four series from 2030 to 2056

Canadian Pacific Kansas City (CPKC) announced the offering on September 28, 2026. Its wholly owned subsidiary, Canadian Pacific Railway Company, is issuing the notes, and CPKC will guarantee them.

The subsidiary is selling C$500 million of 4.20% notes due 2030, C$550 million of 4.60% notes due 2033, C$300 million of 4.90% notes due 2037 and C$450 million of 5.40% notes due 2056.

Closing is expected on October 6, 2026, once customary conditions are met. CIBC World Markets, BMO Nesbitt Burns, RBC Capital Markets and Scotia Capital act as joint lead agents and bookrunners.

The notes are offered in Canada under the subsidiary’s base shelf prospectus of March 6, 2025, with a prospectus supplement dated September 28, 2026. CPKC said the documents would appear on SEDAR+ within two business days. The notes are not registered under the U.S. Securities Act of 1933 and cannot be sold or offered in the United States without registration or an exemption.

Higher coupons than in June 2025

The previous Canadian-dollar offering, announced by CPKC in June 2025, totalled C$1.4 billion in three series: 4.00% notes due 2032, 4.40% notes due 2036 and 4.80% notes due 2055.

Set against those notes, the new coupons are higher at each nearby maturity: 4.60% for 2033 against 4.00% for 2032, 4.90% for 2037 against 4.40% for 2036, and 5.40% for 2056 against 4.80% for 2055. These are coupons fixed at issue, not market yields, and the announcement does not explain the difference.

The company has also borrowed in U.S. dollars this year. CPKC’s quarterly report for the period ended June 30, 2026 shows that in March the subsidiary issued US$600 million of 4.00% notes due March 15, 2029, and US$600 million of 5.50% notes due March 15, 2056.

In the September 2026 offering, each coupon is 0.20 to 0.60 percentage points above the June 2025 Canadian-dollar note with the nearest maturity. Canadian-dollar and U.S.-dollar coupons are not directly comparable. Closing of the September 2026 offering is expected on October 6, 2026. Sources: CPKC June 2025 offering announcement, quarterly report for the period ended June 30, 2026 and September 2026 offering announcement.

CPKC’s debt due within a year

The net proceeds will go mainly to refinancing the subsidiary’s outstanding debt and to general corporate purposes. Until then, the money may be held in bank deposits, money market funds or short-term investment-grade securities. The announcement does not name the debt to be refinanced.

At June 30, 2026, CPKC reported C$2,899 million of long-term debt maturing within one year, including C$1,461 million (US$1,028 million) of commercial paper. In the first half of 2026 the company repaid two U.S.-dollar note issues of US$250 million each at maturity.

In the first half of 2026, CPKC’s long-term debt maturing within one year fell by C$341 million and its long-term debt beyond one year rose by C$2,300 million. Changes are Railway Supply calculations from the reported balances. Source: CPKC quarterly report for the period ended June 30, 2026.