TweakTown
Tech content trusted by users in North America and around the world
5,979 Reviews & Articles | 38,635 News Posts

Apple lays foundation for first-ever debt sale as part of stock buyback program

Apple looking to sell bonds for the first time ever

| Business, Financial & Legal News | Posted: Apr 29, 2013 9:32 pm

Apple has laid the foundation for its first-ever debt sale. The company that has over $140 billion in cash and not a single penny of debt has decided to sell bonds in order to raise capital for its $60 billion share buyback program. It needs to raise capital because only about $45 billion of its cash is in the United States.

 

TweakTown image news/3/0/30027_1_apple_lays_foundation_for_first_ever_debt_sale_as_part_of_stock_buyback_program.jpg

 

Interestingly, Apple was not rated a Triple A rating, even with all of the cash it has on hand. It is expected that Apple could cheaply raise funds, possibly cheaper than Microsoft, due to the current interest rate and notoriety of Apple. Investors are expected to jump at the chance to buy up some of Apple's debt.

 

S&P rated Apple as AA+ for debt and Moody's rated it Aa1. Moody's analyst Gerald Granovsky:

 

Apple's Aa1 rating is not higher due to Moody's view that there are inherent long-run risks for any company with high exposure to shifting consumer preferences.

 

Bankers expect Apple to issue 10-year bonds at roughly 45bp-50bp over Treasuries. Microsoft, on the other hand, recently sold 10-year bonds at 70 basis points over Treasuries.

NEWS SOURCES:Reuters.com

Related Tags

Further Reading: Read and find more Business, Financial & Legal news at our Business, Financial & Legal news index page.

Do you get our news RSS feed? Get It!

Post a Comment about this news

Latest Tech News Posts

View More News Posts
Check out TweakTown Polls on LockerDome on LockerDome

Forum Activity

View More Forum Posts

Press Releases

View More Press Releases