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Pension Funding Through Raising Debt Capital

FedEx recently issued $1.2 billion in bonds, consisting of 37.5% 10-year debt and 62.5% 30-year debt. Of this $1.2 billion raised through debt, Fedex will contribute $1 billion to their U.S. pension fund, which is half of what they plan on contributing in 2017. This follows a recent trend of raising capital for funding pensions through bond issuances. Through September 2016, six separate companies participated in nine individual issuances, totaling $6.65 billion in pension funding, up from $550 million in 2015.