Apple raises $12 billion in perfect style

“Apple wielded the kind of marketing magic in the bond market that it is known for in the tech industry last week when it managed to convince US investors to buy US$12bn more of its bonds at premium prices, just a year after its US$17bn offering left hundreds of bondholders under water,” Danielle Robinson reports for International Financing Review (IFR).

“Despite grumblings from many institutional investors about the performance of its first deal, which had seen its longer-dated tranches plunge in price within weeks of issuance when rates spiked, Apple’s lead managers Goldman Sachs and Deutsche Bank gathered a final book of US$35bn with orders from 1,600 investors,” Robinson reports. “The leads were able to tighten pricing across the seven tranches by 10bp–20bp from initial talk and still had a big enough US$41bn final book to lock in new-issue spreads that left little, if any, new-issue concession on the table.

“It was as if the pain caused by the first deal had never occurred,” Robinson reports. “‘The most interesting thing about this is that they repeated exactly the same pattern as last time – they’re coming to market when spreads are tight, rates are at low and just before payroll numbers,’ said one banker not involved with the deal. ‘But despite what happened the last time, they’ve convinced investors to buy bonds priced right on the screws. Again. It’s incredible.’ Some chalked it up to Apple simply being Apple. ‘When you are the biggest brand name in the world, you can name your price, especially in a market where the technicals are so strong,’ said one DCM head away from the deal.”

Read more in the full article here.

Related articles:
Apple bond deal: Take a bite or steer clear? – April 30, 2014
Orders pour in for Apple’s $12 billion bond offering – April 30, 2014
Apple debt offering only $12 billion – April 29, 2014
Apple about to join the ranks of the biggest U.S. corporate debtors – April 29, 2014
Apple readies blockbuster $17 billion debt sale – April 28, 2014
Apple plans another massive debt sale to fuel new share repurchases, dividends – April 25, 2014

4 Comments

    1. “thin” “air” two words probably used to describe Apple’s next big $$ profit $$ making iPhone 6, the iPhone “Air” 4.7″ screen and just 6mm “thin”…

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