• Apple Expected to Complete Two-Part Sale of Swiss-franc Bonds

    Apple is expected to complete a two-part sale of Swiss-franc bonds today – a move which is set to raise at least $1.08 billion to help fund its massive ongoing capital reinvestment program. The bond will mature in November 2024 at an implied yield of about 0.25% and the 15-year bond will be priced at an implied yield of around 0.7% according to The Wall Street Journal.

    The Cupertino California company is opting to offer its bond in Swiss francs because the demand for debt has pushed government bonds in Switzerland below 0% on maturities stretching out to 11 years. This has pushed prices on corporate bonds down as well – a move that is expected to allow Apple to borrow money at a very discounted rate.

    The money that is borrowed by Apple is expected to be used for dividend payments and share repurchases. With roughly $179 billion in cash and more than $140 billion of that overseas, Apple has been using its extra pile of money to reinvest in itself. The bond sale is set to be overseen by Goldman Sachs and Credit Suisse with demand for Apple bonds expected to be strong, given that the company is profitable and widely known.

    The sale is also set to be Apple’s second bond issue of the year with the company previously raising $6.5 billion last week with a roughly 2.5% yield for 10-year notes and a 3.5% yield for 30-year notes.

    We’ll have to wait and see what happens next.

    Source: The Wall Street Journal via AppleInsider
    This article was originally published in forum thread: Apple Expected to Complete Two-Part Sale of Swiss-franc Bonds started by Akshay Masand View original post
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