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Intel Raises $6 Billion in Bond Sale to Buy Back Stock

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Dec. 4 (Bloomberg) -- Intel Corp. sold $6 billion of bonds in the largest dollar-denominated sale since Abbott Laboratories raised $14.7 billion on Nov. 5, Bloomberg data show.

The offering, which topped the company’s previous record, its $5 billion issue from September 2011, is being used to repurchase stock that’s trading at about the lowest level in 16 months.

The world’s largest semiconductor maker, whose attempt with Microsoft Corp. to combat Apple Inc.’s iPad in the $63.2 billion tablet market is getting off to a slow start, issued $3 billion of 1.35 percent, five-year securities to yield 75 basis points more than similar-maturity Treasuries, $1.5 billion of 2.7 percent, 10-year bonds at a relative yield of 115 basis points, and $750 million each of 4 percent, 20-year securities at 130 basis points and 4.25 percent of 30-year debt at 150, according to data compiled by Bloomberg.

The 20-year portion was added after the deal was marketed earlier today, according to a person familiar with the transaction, who asked not to be identified citing lack of authorization to speak publicly. Proceeds will fund general corporate purposes and previously announced stock buybacks, Santa Clara, California-based Intel said in a regulatory filing.

The company’s $1.5 billion of 4.8 percent securities sold last year and maturing in October 2041 traded at 112 cents on the dollar on Nov. 30 to yield 4.09 percent with a 132 basis-point spread over similar-maturity Treasuries, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

The new bonds are rated A1 by Moody’s Investors Service and A+ by Standard & Poor’s, the ratings companies said today in separate statements.

Shares of Intel have lost 15 percent including reinvested dividends this year and fell to $19.36 on Nov. 21, the lowest closing price since August 2011. The stock rose 2.2 percent to $19.97 today.

To contact the reporter on this story: Charles Mead in New York at cmead11@bloomberg.net

To contact the editor responsible for this story: Alan Goldstein at agoldstein5@bloomberg.net

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