On Monday Apple announced it would raise another $5 billion in the bond market, even though it already held $178 billion in cash. The sale was upped to $6.5 billion because of high demand.
At the time, I noted that Apple’s first bond sale — which was the largest in history — was almost perfectly timed.
AAPL bond sale
On Monday, they priced their 10-year notes with benchmark Treasuries at 1.666% and paid an additional 85 basis points.
Since then, benchmark yields have moved up 27 basis points. A very rough calculation on the $7.5 in bonds and assuming an average duration of 10-years. They saved about $195 million. Or put another way, they could buy all the bonds back tomorrow and have earned $195 million.
Apple bond sale 2015
