DBRS Rates 407 International Inc. Debt Issue at “A”

DBRS has today assigned a rating of “A” to the $800 million senior notes issue (Series 10-A1 and Series 10-A2; together, the Notes) of 407 International Inc. (407 or the Company).

The Notes are being issued from 407’s November 18, 2009 Shelf Prospectus (the Prospectus) which was subsequently amended on June 8, 2010. The effect of the amendment is that holders of new notes to be issued under the Prospectus will not have the benefit of the rating affirmation test described in clause (c) of the first paragraph of the “Capital Markets Platform – Additional Indebtedness Covenant” section of the Prospectus unless specifically provided for in the Pricing Supplement relating to those notes.

The rating affirmation test in the Company’s Master Trust Indenture (the Indenture) limits the amount of debt that can be incurred to a level which is consistent with the rating at that time. That said, this amendment in and of itself does not affect DBRS’s current ratings or trends on 407 as there is no meaningful change to the underlying business, financial profile and/or fundamentals of the Company. (Please see separate DBRS press release dated June 10, 2010, for more a detailed commentary on 407’s amendment to its shelf prospectus.)

The intended use of proceeds from the Notes will be (i) to repay the Company’s $625,000,000, 4.90% Senior Bonds, Series 07-A2, maturing on October 4, 2010, on maturity or redemption, as applicable, (ii) to fund the Series Reserve Account in the Debt Service Reserve Fund (as both terms are defined in the Indenture) in respect of the Notes, and (iii) for general corporate purposes. The financing is consistent with DBRS’s expectations incorporated in its March 16, 2010, confirmation of 407’s ratings. For more detailed analysis on the rating confirmation, please see DBRS’s rating report on 407 dated March 16, 2010.

The Notes will be offered in five- and ten-year tranches and will rank pari passu with all other senior obligations of the Company. As a result, the rating is consistent with the ratings previously assigned by DBRS to the Company’s similarly ranked bonds outstanding.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The applicable methodology is Rating Canadian Public-Private Partnerships, which can be found on our website under Methodologies.

This is a Corporate (Public Finance) rating.