Apple sells $5 billion of debt to finance buybacks and dividends

“Apple Inc. sold bonds again to finance its current round of share buybacks and dividends,” Molly Smith reports for Bloomberg.

“The iPhone maker offered $5 billion of debt in four parts, after dropping a two-year floating rate component, according to a person with knowledge of the matter,” Smith reports. “The longest portion of the sale, a 30-year security, will yield 1.1 percentage points above Treasuries, down from initial talk of around 1.25 percentage points, said the person, who asked not to be identified because the deal is private.”

“Apple is about three-fourths of the way through a program that’s returning $300 billion of capital to shareholders by the end of March 2019,” Smith reports. “At the start of July, the company was sitting on more than $261.5 billion of cash — 94 percent of which was outside the U.S… Apple sold C$2.5 billion ($2 billion) in its first Canadian maple bond deal last month. Goldman Sachs Group Inc., Bank of America Corp. and Deutsche Bank AG managed the latest bond sale, Apple said in a filing.”

Read more in the full article here.

MacDailyNews Take: Until U.S. corporate tax reform and a tax repatriation holiday appear, expect more of the same.

Apple leads maple bond surge to decade high – August 30, 2017
Apple issues Canadian-dollar bond for first time – and sets new record – August 16, 2017
Apple preps first Canadian-dollar debt offering to reward shareholders – August 15, 2017
Apple preparing new euro bond sale to fund capital return program for shareholders – May 17, 2017
Apple issues $7 billion in corporate bonds – May 12, 2017
The fact that Apple has to issue bonds is a reminder of why urgent U.S. tax reform is needed – May 12, 2017
Apple borrows billions while sitting on massive overseas cash mountain – May 10, 2017
Why Apple is investing $148 billion in corporate debt – May 4, 2017
President Trump’s tax reform plan includes deep cuts in corporate taxes – April 26, 2017
Apple raises $10 billion in debt ahead of President Trump’s repatriation tax plans – February 3, 2017
After Apple’s blowout earnings, the Street looks toward ‘iPhone X’ and President Trump’s tax reforms – February 3, 2017
President-elect Trump’s corporate tax reform expected to have some positive impact on Apple EPS – January 14, 2017
Apple has now amassed nearly $80 billion in debt – September 12, 2016


  1. Would investors have tolerated that much of a buildup of cash? I wouldn’t be too happy about it especially if the share price wasn’t comparable to companies like FaceBook and Netflix. At least now, I’m getting decent dividends even though Apple stock is certainly trailing those two companies I mentioned. If Apple were hoarding that much cash then they probably wouldn’t even be acquiring other companies. That would seem to be poor money management.

    I’m not too keen on Apple needing to take on more debt but I suppose it can’t be helped if I expect to keep getting dividends and a diminishing share count. I sure wish those darn tax reforms would get taken care of soon.

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