Apple appeals to debt markets to raise $ 14 billion for future payments to shareholders

• Apple is taking advantage of the low interest rate environment to raise $ 14 billion in debt, according to Bloomberg.
• The debt offering will consist of 40 year bonds and the proceeds of this offering will be used for share repurchases and dividend payments.
• Apple ended its final quarter with $ 196 billion in cash and $ 112 billion in debt.
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Apple has returned to the bond market in an offer that could exceed $ 14 billion, according to a Bloomberg report.

The iPhone maker takes advantage of the low interest rate environment and issues six tranches of debt, with the longest part of the offer being a 40-year bond. The 40-year issue will earn 95 basis points on Treasuries, Bloomberg said, citing someone with knowledge of the matter.

This will be Apple’s third debt offering since May. The proceeds of the offering will be used for general corporate purposes, including share buybacks and dividend payments, capital expenditures, and the acquisition and repayment of debt, Bloomberg said.

Apple ended its final quarter with $ 196 billion in cash and $ 112 billion in total debt. The company generated more than $ 110 billion in revenue during the quarter.

Apple struggled to limit its hoarding of cash after activist investor Carl Icahn urged the company to return money to shareholders in 2013 and 2014.

Apple’s massive cash stack and $ 14 billion bond supply suggests the pace of the company’s shareholder returns is likely to reach new highs this year, according to Bloomberg.

The company has increased its dividend every year since it started paying them again in 2012.

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