DBRS Assigns A (low) Rating with Stable Trend to Finning Debt Issuance

DBRS has today assigned a rating of A (low) with a Stable trend to Finning International Inc.’s (Finning or the Company) issuance of $150 million medium-term notes (the Notes), with a 5.077% coupon, maturing on June 13, 2042. The Notes are expected to settle on or around June 13, 2012.

The Company intends to use the funds from the issuance to repay outstanding indebtedness, including under existing credit facilities or its commercial paper program. Such indebtedness was originally incurred by Finning to fund working capital needs and for other general corporate purposes. Alternatively, Finning may invest the net proceeds of this offering in short-term investments until such time as the acquisition described below is completed and then use such proceeds to directly pay a portion of the purchase price for such acquisition.

DBRS notes that Finning had previously announced that it expects to complete the acquisition of the Canadian portion of the distribution and support business conducted by Caterpillar Global Mining LLC (formerly Bucyrus International Inc.) in Q3 2012. If the transaction is completed, the amounts repaid with the proceeds of this issuance may be re-borrowed to finance the purchase price payable by Finning in respect of such acquisition. These additional borrowings have been factored into the rating. (See DBRS press release dated January 18, 2012, for additional details.)

The Notes will be direct unsecured and unsubordinated obligations of Finning and rank pari passu with all other unsecured and unsubordinated indebtedness of the Company. The debt offering has been made under the base shelf prospectus dated May 22, 2012, which allows offerings of up to $600 million of medium-term notes.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The applicable methodology is Rating Companies in the Industrial Products Industry, which can be found on our website under Methodologies.