(Bloomberg) — Brightline, the first private U.S. passenger railroad in more than a century, has received an investment-grade rating on its proposed senior municipal bonds ahead of a planned refinancing of $3.6 billion in debt.
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S&P Global Ratings has assigned a preliminary BBB rating, the lowest investment grade, to the $2 billion tax-exempt Brightline bond that Florida Development Finance Corporation plans to issue this month. Brightline expects Assured Guaranty to guarantee his $1 billion bond. Tax-exempt debt.
The Fortress Investment Group-backed railroad, which launched long-distance service between Miami and Orlando in September, plans to sell $1 billion in speculative-grade corporate bonds with yields in the high single digits to low double digits. Bloomberg previously reported that there is. An additional $1.6 billion in debt and equity could be raised from Fortress and other investors.
Brightline, which carried about 230,000 passengers in February, launched short-haul service between Miami and West Palm Beach in 2018.
Market participants say an investment-grade rating could expand the market for high-speed rail municipal bonds and lower borrowing costs. Brightline’s current municipal bond debt is unrated.
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