Apple plans to sell $14 billion in bonds, taking advantage of cheap borrowing costs to finance corporate transactions such as share buybacks. According to the report published by Bloomberg, the technology company will issue debts in six divisions.
Apple enters the market for the third time
Apple’s preliminary applications for the sale of bonds emerged early Monday morning, with a plan to issue debt in six divisions, as well as its longest offer, a 40-year guarantee, attracting considerable attention.
According to Bloomberg Barclays index data, average investment-grade companies will be able to borrow 1.86 percent for nine years from the time Apple last offered a debt deal.
It is also stated that Apple plans to use the proceeds for general corporate purposes, such as stock buybacks and paying dividends to shareholders. In addition, the money is also expected to be available for working capital, capital expenditures, debt reimbursement or investments.
With the new debt deal, it is the third time Apple has entered the market since May 2020. So much so that the Cupertino technology company sold $8 billion in bonds in May and $5.5 billion in August.
In addition, according to Apple Insider, the technology company has accumulated cash for years, but has recently changed strategies to reduce its net cash position.
Finally, let’s point out that in early January, Apple’s quarterly revenue for the first time exceeded $100 billion, and its Q1 2021 results of $111.4 billion eclipsed its previous high of $91.8 billion, but also represented annual growth of 21.4 percent.