DBRS Assigns Provisional Rating of BBB (low) with Stable Trend to Viterra’s New Notes

DBRS has today assigned a provisional rating of BBB (low), with a Stable trend, to the proposed issuance of up to $500 million Senior Unsecured Notes (the Notes) by Viterra Inc. (Viterra or the Company). The rating is subject to the Notes ranking pari passu with all of Viterra’s debt.

DBRS expects that the Notes will rank pari passu with all of Viterra’s existing and future senior unsecured debt after Viterra closes its $1.6 billion unsecured revolving credit facility and uses a portion of the new operating line to repay the $400 million term loan facility put in place in May 2008. This will result in the elimination of security on all of Viterra’s existing publicly traded notes and DBRS will withdraw the Senior Secured Notes rating at that time. Please see DBRS rating report dated March 17, 2010, for further details.

The $1.6 billion unsecured revolving credit facility will also replace Viterra’s existing $800 million line of credit in Canada and the A$1.2 billion operating line in Australia.

The Company intends to use the net proceeds from the offering to pay off the drawdown on the $1.6 billion unsecured revolving credit facility. As a result of these two transactions, the proceeds of the Notes offering will effectively be used to refinance the $400 million term loan facility. In addition, Viterra intends to refinance its $100 million of Series 2006-1 Notes, which pays 8% interest annually and matures in 2013. The Company will exercise its right to redeem the Series 2006-1 Notes at 102% of the principal amount of those notes, plus accrued and unpaid interest to the date of redemption.

The provisional rating and trend are based on information received by DBRS on or before May 5, 2010, and may change when ratings are finalized or be withdrawn at any time. DBRS will assign a final rating subject to DBRS having comfort that the Company’s final documentation is not significantly different from our expectations and Viterra repays its $400 million term loan facility.

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

The applicable methodology is Rating Grain Companies, which can be found on our website under Methodologies.

This is a Corporate (Consumers) rating.