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Athabasca oil sands digger, Albian Sands, Alberta, Canada.
Athabasca oil sands digger, Albian Sands, Alberta, Canada.
(Dieter Blum/Shell)

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Athabasca seeks cheap money, may face push back

Athabasca Oil Corp. is looking to set a record for a Canadian high yield bond sale Friday, and seeking to do it at a very attractive interest rate for the company.

According to people familiar with the transaction, the Alberta oil field developer is hoping to pay an interest rate in the 7 per cent range on $600-million of new five-year bonds, an aggressive target for an offering that would be the largest in Canadian history, but one that reflects the current hunger investors have for yielding assets. Even so, the company is likely to get push back from the market that a higher rate, closer to 7.5 per cent, is more appropriate given the risk in the transaction.