“Apple Inc. (AAPL) is about to join the ranks of the biggest U.S. corporate borrowers as the iPhone maker starts marketing bonds in what it says may rival last April’s then-record $17 billion offering,” Sarika Gangar and Matt Robinson report for Bloomberg.
“The iPhone maker is offering bonds in seven parts, according to a person with knowledge of the transaction,” Gangar and Robinson report. “The Cupertino, California-based company plans to issue both floating- and fixed-rate notes with maturities of three and five years in addition to fixed-rate notes due in seven, 10 and 30 years, said the person, who asked not to be identified because terms aren’t set.”
“Apple said last week it will seek to raise an amount ‘similar’ to what it issued in 2013. That would about double its debt load this year to put it within the 20 largest U.S. corporate borrowers,” Gangar and Robinson report. “Apple is opting to issue debt rather than use $159 billion of cash and marketable securities that’s mostly held overseas and subject to repatriation taxes.”
Full article here.
Capitalists will love this step in Apple’s trajectory, it makes Apple seem almost normal.
Dividends, Buybacks, and Stock splits are great programs but Apple acquiring debt is the American way and will make them seem more attractive to capitalists.
Statist redistributionists (taking from the makers in order to keep the takers in slavery to guarantee votes) will hate it because they don’t understand simple economics or basic human nature, obviously.
The richest among us Americans are in fact Republicans who are busy redistributing the world’s wealth from the Middle Class to themselves!
The Makers are the laborers and inventors and creators. The Takers are the Private Equity firms buying up everything and giving it all to the rich.
BS. There are plenty of rich Democrats; just look at George Soros, the Senate, Hollywood, etc. etc.
Thank goodness there are rich Democraps or the entire market for buying votes via advertising would disappear and the media members of our Corporate Oligarchy would be all up in arms and lobbying #MyStupidGovernment to transfer money back to the Democraps again so they could rev up the competition engine again for buying votes.
Sick, isn’t it.
You seem to be unable to make distinctions in what people say, namely, I said the richest Americans are Republicans.
I don’t disagree there aren’t rich Democrats but I’m pretty sure the richest of the American Congresspeople are in fact Republicans.
The good thing is Apple could write a check the next day to pay off the debt.
Except that if they did so, the shareholders would get ass-raped for 35% of any funds Apple brought back into the USA to do so.
-jcr
I disagree. Apple has plenty of Front companies who could accept that check and see to it, the debt is paid off.
You seem to be a “glass half-empty” kind of guy.
Why can’t Apple Subsidiary in Ireland invest in the debt from Apple U.S.? That would be an interesting way to get the money into the U.S. without paying repatriation taxes.
Very good, now you’re thinking like an American businessperson!
Makes sense, they can borrow the money for less than the dividend that would have to be paid out on the retired stock. They interest will be fixed whereas the dividend is likely to increase over the years and the interest payments are tax deductible.
Agreed, financially it makes sense for Apple to borrow money to buyback shares to reduce their dividend and tax burden.
It still doesn’t sit well with me that companies are borrowing money for this type of activity.
There’s a big difference regarding Apple vs. other companies: Apple has the cash, both in revenue and in the bank, to pay off the debt should it ever need to.
I may be wrong but isn’t Apple’s offshore billions about to be used to buy bonds of several sizes, rates and due dates?
As several people have pointed out yesterday, Apple’s overseas money are in separate entities so they have to be careful how they use the cash. Whilst they could not use the money to pay interest, you maybe onto something about them buying the bonds. It would make me feel better that Apple subsidiaries are buying the debt that the central company is offering.
Now isn’t THAT an interesting concept?! Hmm!!
Meanwhile, how utterly sick and self-destructive that #MyStupidGovernment viciously insists upon 35% taxation of repatriated profits, while Apple can become a MASSIVE debtor and SAVE $BILLIONS in the process thanks to loan rates dramatically cheaper than #MyStupidGovernment’s tax rate.
#MyStupidGovernment is sooooo stupid… 😯 😯 😯 😯
The iPhone maker is offering bonds in seven parts
Seven? Did he write seven? There’ something familiar about that number. Why does ‘seven’ remind me of something? Strange.