Apple Inc., one of the most cash-rich companies in the world, isstill looking to get a piece of the ultra-cheap money that's up forgrabs in the bond market.

With investment-grade bond yields hovering near record lows,it's tempting even for Apple—with more than $200 billion of cashand investment securities on its books—to see what investors willlend it. Turns out that number is $7 billion, or just over 3percent of its current coffers.

With the 30-year Treasury at record lows, many companies havebeen able to borrow more cheaply for much longer. Apple will payaround 2.98 percent interest on its new 30-year bonds, comparedwith the 3.45 percent it's paying on three-decade bonds it sold in2015. On a $1.5 billion issue, that equates to savings of just over$7 million of interest annually, or $211.5 million over the courseof three decades.

Continue Reading for Free

Register and gain access to:

  • Thought leadership on regulatory changes, economic trends, corporate success stories, and tactical solutions for treasurers, CFOs, risk managers, controllers, and other finance professionals
  • Informative weekly newsletter featuring news, analysis, real-world cas studies, and other critical content
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical coverage of the employee benefits and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.