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Apple Inc (NASDAQ: AAPL) has started selling four parts bonds, with the longest portion of the offering, a 40-year security, which may yield around 150 basis points over US Treasuries, Bloomberg reported on Monday, citing a person familiar with the matter.
The Cupertino giant is tapping the high-grade bond market to use the proceeds for general corporate purposes, including financing the share buybacks and dividends, the report said.
The sale comes after the US market for investment-grade bonds sprang back in the second half of July amid a credit market rally. Many of the big banks brought large debt sales after reporting earnings, helping supply beat expectations for the month.
Although Apple is currently sitting on around $180 billion cash and cash equivalents stockpile, it has paid out around $14 billion in dividends each of the last three years.
The report mentioned that Goldman Sachs Group Inc, JPMorgan Chase & Co and Bank of America Corp are leading the sale.
In December, the iPhone-maker’s long-term credit was upgraded to ‘Aaa’ by Moody’s, putting the tech giant in an exclusive club with Microsoft Corp (NASDAQ: MSFT) and Johnson & Johnson (NYSE: JNJ) as the only US corporations in the S&P 500 with the highest possible credit rating.
Picture Credit: BBC
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