Microsoft Bond Investors Wary as Activision Deal Greenlit

The tech giant’s balance sheet ‘could change dramatically’: BI
Software firm’s longer-dated bond spreads widen on Tuesday

WATCH: Microsoft Corp. won a court’s okay to move forward with its $69 billion deal to buy Activision Blizzard Inc. Bloomberg’s Ed Ludlow reports.Source: Bloomberg

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By Caleb Mutua and Olivia Raimonde

July 11, 2023 at 5:22 PM UTC

Updated on

July 11, 2023 at 6:10 PM UTC

This article is for subscribers only.

Microsoft Corp.’s creditors turned slightly more cautious on the software company’s longer-term, high-quality debt after a US judge approved its planned $69 billion deal to buy video game maker Activision Blizzard Inc.

The extra yield investors demand to hold onto Microsoft’s 2.525% senior unsecured bonds maturing in June 2050 over comparable US Treasuries rose by 5 basis points to 70 basis points as of 2 p.m. Tuesday in New York, according to Trace bond data. The risk premium on the tech giant’s 2.921% notes maturing in March 2052 widened 4 basis points to 70 basis points.