Apple is ready to expand its bond sales to Australia and has calls with investors lined up for Monday. The bonds could raise between AU$500 million (about US$368.4 million) and $1 billion, and are expected to give the Australian investor's market a big boost.
Apple gets ready for kangaroo bond sale
Apple's bond program already extends beyond the United States, but this marks the first time the iPhone and iPad maker has eyed kangaroo bonds. The term "kangaroo bond" refers to bonds from foreign companies sold in Australia.
The company's bond sales outside the U.S. include the Euro, Swiss franc, Yen, and sterling. Assuming Apple manages to hit the high end of its range in Australia, it'll be in line with the largest bond sales in the country.
The bond sales raise the money Apple uses to pay shareholder dividends and to buy back its own stock. The interest Apple pays on the bonds is significantly lower than the taxes it would pay by bringing its own overseas revenue into the U.S.
Issuing bonds adds debt to Apple's books, but also underscores what many corporations see as a big problem with the U.S. tax code. The money they'd pay out in taxes to repatriate their cash is so high that it's fiscally irresponsible to bring revenue into the country.
Instead, Apple can get low interest bonds it pays back over time and keep its own cash safe from exorbitant taxation.
Apple hasn't said yet when its kangaroo bond sale will start, but considering investor talks are starting today it'll likely be soon.
[Thanks to Reuters for the heads up]