Since November 2017 Apple plans to borrow in the bond market for the first time, based on a prospectus filed on Wednesday.
It’s the first time Apple has borrowed through the bond market since U.S. tax reform took to have an influence on in early 2018, enabling Apple to bring back a lot of billions in overseas cash at a decrease tax rate, which has since funded Apple’s $175 billion plan to return capital to shareholders.
Apple plans to make use of the gains from the bonds for “general corporate purposes,” together with share buybacks, payment of dividends, funding for working capital, and acquisitions, based on the prospectus.
It’s cheap to borrow proper now. 10-year Treasurys currently offer a traditionally low yield of 1.47%, close to which means that Apple’s bonds might be attractive to traders looking for higher returns. Apple is trying to raise between $4 billion and $5 billion, according to Dow Jones.
Apple has $210.6 billion in cash and marketable securities on hand; the company said in July, down 26% from its first-quarter 2018 peak of $285.1 billion. It also has $98.3 billion in total term debt as of the top of the June quarter, based on the prospectus.
Apple added that it would improve its share buyback program by $75 billion in April and raised its quarterly dividend by 5%.
Apple has said it intends for a net-cash-neutral place. The corporate can be financing in the United States, including a proposed $1 billion campus in Austin, Texas.