“Apple Inc. is poised to borrow cash in euros at some of the lowest interest rates on record for a company, following up on a plan set out earlier this year to issue bonds in currencies other than the dollar,” Ben Edwards reports for The Wall Street Journal. “The iPhone maker will raise €2.8 billion ($3.5 billion) from two chunks of euro debt maturing in eight and 12 years.”
“Bankers managing the bond sale said the eight-year notes will give investors a yield of roughly 1.1% and the 12-year notes around 1.7%,” Edwards reports. “Those will beat the lowest yields ever paid for euro-denominated, corporate bonds of these maturities, according to Dealogic data, reflecting solid confidence that the bonds represent a safe bet.”
“Apple spoke with investors on Monday about issuing bonds and will use the proceeds of the sale for general corporate purposes, including share buybacks and dividend payments,” Edwards reports. “Deutsche Bank AG and Goldman Sachs Group Inc. are the banks running the euro sale, which is expected to be completed later Tuesday.”
Read more in the full article here.
“…plans to raise $3.5 billion in euro debt”
About a month’s profit. What Tim Cook likes to call “a little walking around money”.
That is a great idea. €2.8 billion ($3.5 billion) today may be only $3.0 billion or $2.5 billion as the euros continue to tank if we can stop screwing over our American dollars.
Just to make investors happy huh? Hmmm
Well it’s not coming at the expense of their business.
Like it or not, Apple has to hire financial managers to deal with its huge mountain of cash (these are people who were hired by Steve Jobs BTW). As such, they’re using their extraordinarily strong cash position to leverage extremely low risk investments.
It’s smart, and it will pay off for them.
Debt games are a waste of Apple’s time. Apple doesn’t need to support banks to feed them more “walking around money”. Apple doesn’t need to pander to activist investors. Apple needs to take its cash horde and update its hardware and software. We all know of aging products that are looooong overdue for a refresh. We also see Apple is still reliant on scummy suppliers. There is absolutely no acceptable reason for Apple management to be wasting its time pandering to Wall Street while it has so many important strategic missions to get done.
Lest we forget how much Apple has forgotten, let’s just post a few nice ideas:
4″ screen iPhones with A8 chipset. Retina displays across the board. 802.11c wifi across the board. improved battery life across the board. updated iPods. new Thunderbolt displays in multiple sizes. greater memory iPads. more solid state drive and user-upgradeable memory options in Macs. Give the user better font and color control in both iOS and OS X. Restore features lost or buried in latest iTunes and iWork releases. You can all think of more. So much to do!!!