Berkshire Hathaway 2011 Annual Report Download - page 50

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Notes to Consolidated Financial Statements (Continued)
(14) Notes payable and other borrowings (Continued)
In connection with the BNSF acquisition, the Berkshire parent company issued $8.0 billion aggregate par amount of senior
unsecured notes, including $2.0 billion par amount of floating rate notes that matured in February 2011. In August 2011, the
Berkshire parent company issued $2.0 billion of senior notes consisting of $750 million of 2.2% senior notes due in 2016, $500
million of 3.75% senior notes due in 2021 and $750 million of floating rate senior notes due in 2014. In January 2012, the
Berkshire parent company also issued $1.1 billion of 1.9% senior notes due in 2017 and $600 million of 3.4% senior notes due
in 2022 and in February 2012 redeemed $1.1 billion of floating rate notes and $600 million of 1.4% senior notes that were both
due at that time. Other subsidiary borrowings as of December 31, 2011 included $1.6 billion in pre-acquisition debt issued by
Lubrizol.
Average
Interest Rate
December 31,
2011 2010
Railroad, utilities and energy:
Issued by MidAmerican Energy Holdings Company (“MidAmerican”) and its
subsidiaries:
MidAmerican senior unsecured debt due 2012-2037 ......................... 6.1% $ 5,363 $ 5,371
Subsidiary and other debt due 2012-2039 .................................. 5.2% 14,552 14,275
Issued by BNSF due 2012-2097 ............................................. 5.9% 12,665 11,980
$32,580 $31,626
MidAmerican subsidiary debt represents amounts issued pursuant to separate financing agreements. All or substantially all
of the assets of certain MidAmerican subsidiaries are or may be pledged or encumbered to support or otherwise secure the debt.
These borrowing arrangements generally contain various covenants including, but not limited to, leverage ratios, interest
coverage ratios and debt service coverage ratios. BNSF’s borrowings are primarily unsecured. As of December 31, 2011, BNSF
and MidAmerican and their subsidiaries were in compliance with all applicable covenants. Berkshire does not guarantee any
debt or other borrowings of BNSF, MidAmerican or their subsidiaries. In May 2011, BNSF issued $750 million in debentures
comprised of $250 million of 4.1% debentures due in June 2021 and $500 million of 5.4% debentures due in June 2041. In
August 2011, BNSF issued $750 million in debentures comprised of $450 million of 3.45% debentures due in September 2021
and $300 million of 4.95% debentures due in September 2041.
Average
Interest Rate
December 31,
2011 2010
Finance and financial products:
Issued by Berkshire Hathaway Finance Corporation (“BHFC”) due 2012-2040 ........ 4.4% $11,531 $11,535
Issued by other subsidiaries due 2012-2036 .................................... 4.8% 2,505 2,942
$14,036 $14,477
BHFC is a 100% owned finance subsidiary of Berkshire, which has fully and unconditionally guaranteed its securities. In
January 2011, BHFC issued $1.5 billion of notes and repaid $1.5 billion of maturing notes. The new notes are unsecured and are
comprised of $750 million of 4.25% senior notes due in 2021, $375 million of 1.5% senior notes due in 2014 and $375 million
of floating rate senior notes due in 2014.
Our subsidiaries in the aggregate have approximately $3.7 billion of available unused lines of credit and commercial paper
capacity at December 31, 2011, to support our short-term borrowing programs and provide additional liquidity. Generally,
Berkshire’s guarantee of a subsidiary’s debt obligation is an absolute, unconditional and irrevocable guarantee for the full and
prompt payment when due of all present and future payment obligations.
Principal repayments expected during each of the next five years are as follows (in millions).
2012 2013 2014 2015 2016
Insurance and other ................................................. $3,390 $2,725 $1,345 $1,918 $ 869
Railroad, utilities and energy .......................................... 2,567 1,774 1,618 713 681
Finance and financial products ......................................... 3,155 3,661 1,335 1,656 205
$9,112 $8,160 $4,298 $4,287 $1,755
48