Caisse completes $5 bln offering in refinancing

The Caisse said in a statement that the debt offering through its CDP Financial subsidiary was the largest-ever guaranteed offering by a Canadian issuer in U.S. dollars.

It comprises three tranches of debt securities: $2 billion in 3 percent, 5-year senior notes; $1.75 billion of 4.4 percent, 10-year senior notes; and $1.25 billion in 5.6 percent, 30-year senior notes.

"The proceeds of this refinancing program will be used to replace certain short-term debt with longer-term debt, thus better matching the duration of the Caisse's sources and uses of financing, and increasing the stability of financing sources," the fund manager said in a statement.

Montreal-based Caisse, once Canada's biggest pension fund manager by far, announced the multibillion-dollar borrowing plan earlier this month. It said the refinancing program could see it issue as much as C$8 billion ($7.6 billion) of bonds in Canada, the United States and Europe by the end of 2010, depending on market conditions.

"In the context of this program, CDP Financial does not intend to issue notes in the Canadian market until 2010," the Caisse said.

The Caisse, which managed C$120.1 billion in assets at the end of last year reported C$39.8 billion in losses in 2008 amid global market turbulence that wreaked havoc on the portfolios of some of Canada's chief pension funds.

The Caisse is an arm's-length agency that manages investments for various public and private pension plans in the largely French-speaking province of Quebec.

($1=$1.05 Canadian) (Reporting by Pav Jordan; editing by Rob Wilson)