Apple taps US bond market for $5bn to fund its share buyback
APPLE was last night issuing new bonds thought to be worth $5bn (£3.3bn) to fund a host of “general corporate purchases,” including share repurchases.
Despite its record quarterly profits of $18bn, the tech giant is making the most of historically-low costs of corporate borrowing.
In its Securities and Exchange Commission (SEC) filing Apple said the bonds would also be used to fund its dividend, capital expenditures, acquisitions, and debt repayments. Seven, 10 and 30-year fixed and floating rate bonds with a minimum value of $2,000 were among the tranches made available, with Goldman Sachs and Deutsche Bank handling the sale.
Floating and fixed rate notes will be due in 2020, and further fixed rate notes will be due in 2022, 2025 and 2045. A yield rate was not disclosed in its preliminary filing with the SEC last night.
The company issued its first non-dollar debt offering in November last year, selling €2.8bn (£2.2bn) of euro bonds to take advantage of rock-bottom borrowing rates. It offered a 1.08 per cent rate on the eight-year note at the time.
Shares in the iPhone-maker reached an all-time high of $120 last week following Apple’s bumper results.