Apple has given U.S. bond market investors something to smile about this week, as the company has brought forward its highly sought after seven-part bond offering valued at $12 billion. The offering is to help finance its share buyback plans.
The bond sale issued on Tuesday was less than the $17 billion the company sold in a record setting offering a year ago. But investors believe that Apple isn’t done yet, as the company signaled during its quarterly earnings conference call last week that it would likely raise “an amount of term debt financing similar to what we used in 2013,” Corporate Comptroller Luca Maestri said.
It is expected that the iOS device maker will also turn to the foreign debt markets, allowing the company to diversify its base and avoid saturating the U.S. debt market.
Reuters reports that investors believe Apple is waiting to come to market with potential issues in euros or sterling in the near future, targeting the eurozone for low interest rates on an additional offering of around $7 billion.
Investors rushed to take advantage of Tuesday’s sale, generating over $40 billion worth of orders in midday trading. Apple’s bonds are rated at double-A-plus, the second-highest rating possible.
While Apple has around $150 billion in cash in its coffers, $130 billion of that cash pile is held overseas. Apple refuses to repatriate any of that money, citing high tax rates for bringing the money back to the U.S.