In Brief: Morgan and Chemical Win Railroad Loan

J.P. Morgan & Co. and Chemical Banking Corp. have won the mandate to lead a $2.5 billion loan for Burlington Northern Santa Fe Pacific Corp.

The loan is the first for the newly merged railroad, and replaces two earlier Burlington facilities and one Santa Fe loan, market sources said.

The new facility brings together the bank leaders for each company. Morgan was the adviser to Santa Fe and Chemical was Burlington's agent bank.

Chemical will serve as the administrative agent, and Morgan will act as the documentation agent on the new loan.

Each of the lead banks will underwrite $200 million and will be looking for commitments of either $100 million, $75 million, or $50 million.

The deal is divided into a $1 billion one-year revolving credit and a $1.5 billion five-year revolving facility.

A bank meeting is scheduled for Oct. 27.

Pricing on the deal was not yet available.

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