Ondrej Holzman Although Apple revealed last week breaking records financial results and announced that it has about $180 billion in cash, but despite all that it will go into debt again — issuing $6,5 billion in bonds on Monday. He will use the obtained funds to pay dividends.
This is the fourth time the Californian company has taken a similar step in the last almost two years. In April 2013 were bonds for 17 billion, a record at the time and since then Apple has already issued bonds for a total of $39 billion.
Apple issued the latest bonds in five tranches, the longest for 30 years, the shortest for 5, in order to be able to buy back its shares, pay dividends and repay previously created debt. The company itself has huge capital, but most of its $180 billion is outside the United States.
It is therefore more advantageous for Apple to borrow through bonds, where the interest payments will be cheaper (interest rates this time should range from about 1,5 to 3,5 percent) than if it transferred money from abroad to the United States. Then he would have to pay a high 35% income tax. However, there is a lively debate in America about how to change the situation.
Some senators suggest that overseas earnings may not be taxed at all when transferred, but then they could not be used, for example, to buy back shares, which is what Apple is planning.
Apple's current program includes a $130 billion share buyback, with CFO Luca Maestri revealing during the announcement of its latest financial results that his company has already used $103 billion. There are four quarters left in the plan and an update is due in April.
