Microsoft has commenced selling debt in the US and European markets. According to the Wall Street Journal
, the initial offering is a minimum of $500 million. The move is the software developer's fifth offering since 2009, and the company should be able to get the lowest yields of the year for a five-year corporate debt offering.
Initial estimates show the bonds boasting a five-year maturing yielding 0.35 to 0.40 percentage point more than similar Treasury bonds. Ten-year bonds offer 1.05 to 1.15 percentage points, with 30-year bonds sporting 1.25 to 1.30 percentage points. European bond offerings are being offered, with Microsoft looking for $715 million in bonds.
The move is similar to what Apple announced in its last set of quarterly earnings
, with expected demand for both companies bonds strong. Apple's credit rating is AA+, with Microsoft coming in slightly higher at AAA. Corporate bond offerings are seen as a way for both companies to bridge the current low-yield markets and stave off some financial uncertainties for future quarters, at least until the economic climate improves.