Business Case Studies & Business Publications

Norfolk Southern Corporation—Century Bon...

Conroy, Robert M.

Case

Norfolk Southern Corporation—Century Bonds

Conroy, Robert M.

F-1733 | Published May 22, 2015 | 10 pages Case

Collection: Darden School of Business

Product Details

Norfolk Southern Corporation (NSC), a railway operator, was issuing a $250 million bond with a coupon of 6% and a maturity in 2105. The bonds were added to an existing $300 million 6% debt issue due 2105, which the company first sold in 2005. A bond analyst at Tidal Insurance (Tidal), has heard that the original issue of this century bond was to be $100 million, and it seemed that strong investor demand pushed NSC, to increase the total amount to $250 million. He has to decide whether Tidal should include the NSC bond in its bond portfolio.