Apple Planning $1.6 Billion Bond Sale in Japan?

Apple is reportedly considering issuing about 200 billion yen ($1.62 billion) in bonds as early as June in Japan, reports Nikkei. The sale of the bonds would be the first fundraising activity for Apple in Japan.

Early this month, Apple started gauging potential demand for the yen-denominated bonds among regional banks, life insurers and other institutional investors. The bonds will target Japanese investors but will likely be sold to overseas investors as well.

Despite having over $200 billion in cash, Apple still issues bonds so that it can procure funds at low interest rates, which helps create a tax shield that generates shareholder value.


It is likely that Apple can demand an interest rate in Japan about 1 percentage point lower than in the U.S, especially with Apple's higher credit rating. Apple just recently sold $6.5 billion in bonds in February. It was the fourth time in less than two years that Apple has raised over $3 billion in the debt markets.