Apple raised 17 billion dollars Tuesday in a record bond offering that was snapped up by investors at rates almost as low as those paid by the US treasury.
For Apple, which has a cash hoard of 144 billion dollars, the bond issue was the first time it had borrowed money in some two decades. Despite its vast stockpile of cash, Apple issued the new debt in order to fulfill its obligations to return cash to shareholders and buy back stock without repatriating its money to the US where it would be subject to tax at a rate of 20 to 25 per cent.
Prior to Apple's offering the highest-ever bond issue was 16.5 billion dollars raised by Swiss company Roche in 2009, according to data provider Dealogic.
Apple borrowed 5.5 billion for 10 years at an annual yield of 2.415 per cent, according to the Wall Street Journal. The company issued three-year debt at 0.511-per-cent, five-year debt at 1.076-per-cent and 30-year debt at 3.883-per-cent.
Apple also sold floating-rate bonds that mature in three and five years at rates of 0.05 and 0.25 percentage point over the three-month London interbank offered rate, an industry benchmark.
Most Popular Stories
- 'Lucy's' Super Powers Tops 'Hercules' at Box Office
- The 2014 Fastest-Growing 100
- The Rise and Fall of Richard Alarcon
- Vancrest Assisted Living Project to Add 20 Jobs
- Fighting Blocks Investigators, Police From MH17 Crash Site
- U.N. Renews Demand for Gaza Cease-Fire
- VW Site Could Mean Another 2,000 Jobs for Chattanooga
- Nissan Profits Rise on Growth in U.S., China
- 'Sharknado' Sequel Has Bite and Lots of Laughs
- Insecticides Permeate U.S. Food, Water Supply