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Apple prepping first Australian dollar-denominated bond offering - report

Apple will reportedly continue to diversify its corporate debt issuance strategy with a new bond denominated in Australian dollars, the company's latest move to raise debt outside the United States in order to fund its growing capital return program.

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Apple is expected to raise at least A$500 million ($369 million), but the offering could go as high as A$1 billion, one Australian banker told Reuters. If it trends toward the higher end of that range, it would be among the largest bonds ever floated in the Australian market.

There is no word on when the so-called "Kangaroo" offering could take place, but Apple will likely begin calls with investors on Tuesday.

Apple issued its first foreign currency bond last November, raising $3.5 billion with a euro-denominated offering. That was followed by a $1.08 billion Swiss franc bond in February of this year, a $2 billion yen debut in June, and a $2 billion sterling issue in July.

The bonds are primarily used to fund Apple's massive capital return program, which is targeted to hand $200 billion back to shareholders through dividends and buybacks by the end of March 2017. While Apple has more than $220 billion in cash and marketable securities, much of it— more than $190 billion— is held in its foreign subsidiaries.

Thanks to U.S. corporate tax policy, which would require Apple to pay another round of taxes on that money if it were to come back to the U.S., issuing debt is significantly less expensive than repatriating Apple's foreign cash.