Apple Extends Kangaroo Bond Curve to 10 Years With Second Forayby
Raises A$1.425 billion in three-part Aussie dollar offering
Follows inaugural transaction by iPhone maker in August 2015
Apple Inc. extended its Kangaroo bond curve out to 10 years with its second trip to the Australian debt market.
The iPhone maker, which last year issued four-year and seven-year securities in its inaugural offering Down Under, on Friday sold A$1.425 billion ($1.04 billion) of notes across three different maturities, according to two people familiar with the matter who asked not to be identified because they’re not authorized to speak publicly. In addition to June 2026 bonds, the electronics firm also raised funds with notes maturing in June 2020 and January 2024, they said.
The sale comes as buyers increasingly embrace the higher yields offered by longer-tenor debt as unprecedented global easing drives down the interest rates offered by fixed-income investments. In Australia, Apple joins the likes of Qantas Airways Ltd., Coca-Cola Co. and Asciano Ltd. in selling securities beyond the seven-year mark that’s been the limit for many non-financial corporate borrowers in recent years.
The Cupertino, California-based company priced A$325 million of 10-year bonds at a yield of 1.35 percentage points more than the swap rate, the people familiar said. The four-year tranche raised A$650 million at a spread of 0.82 percentage point, while the 2024 securities were priced at a gap of 1.25 percentage points, they said. Apple’s previous deal in August 2015 raised a total of A$2.25 billion, the most ever in Australia by a firm outside the financial services industry.
The sale was managed by Australia & New Zealand Banking Group Ltd., Deutsche Bank AG and Goldman Sachs Group Inc., the people familiar said.