- Apr 12, 2001
Apple has raised $10 billion in debt through a nine-part bond sale of both fixed and floating rate notes, according to the company's final pricing term sheet filed with the U.S. Securities and Exchange Commission on Friday.
The nine-part sale includes:
$500 million maturing in 2019 with a floating interest rate based on three month LIBOR plus 8 basis points
$500 million maturing in 2020 with a floating interest rate based on three month LIBOR plus 20 basis points
$1 billion maturing in 2022 with a floating interest rate based on three month LIBOR plus 50 basis points
$500 million maturing in 2019 with a fixed 1.55% interest rate
$1 billion maturing in 2020 with a fixed 1.9% interest rate
$1.5 billion maturing in 2022 with a fixed 2.5% interest rate
$1.75 billion maturing in 2024 with a fixed 3% interest rate
$2.25 billion maturing in 2027 with a fixed 3.35% interest rate
$1 billion maturing in 2047 with a fixed 4.25% interest rate
Apple held $246.1 billion in cash and marketable securities last quarter, but around 94% of that money is held overseas and would be subject to high U.S. taxes upon repatriation--something U.S. President Donald Trump plans to change. In the meantime, by raising debt through bonds, Apple can pay for its U.S. operations at a much lower rate, particularly given its low-risk Aa1/AA+ bond credit rating.
Apple typically uses the capital raised to fund dividend payments to shareholders and its share buyback program. Last quarter, Apple returned almost $15 billion to investors through dividends and buybacks. $201 billion of Apple's $250 billion capital return program has been completed. The company also uses the capital for general corporate purposes, such as the repayment of earlier debt and acquisitions.
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Article Link: Apple Raises $10 Billion in Debt Ahead of Trump's Plans for Tax Holiday
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