Alphabet Inc. intends to raise up to $25 billion through the issuance of dollar-denominated bonds, according to Bloomberg, citing informed sources.
According to the agency’s sources, the company plans to sell up to ten tranches of bonds with maturities ranging from two to 40 years. The preliminary yield guidance for the ‘longest-dated’ securities implies a premium of 1.55 percentage points over the yield on comparable US Treasuries, the sources note. This is approximately 0.4 percentage points higher than the yield on the company’s outstanding bonds.
Demand for the company’s bonds has already reached around $115 billion, according to sources.
In February, Alphabet issued $20 billion worth of dollar-denominated bonds, and the company subsequently raised funds through bond issues denominated in euros, Swiss francs, pounds sterling, Canadian dollars and Japanese yen. The total volume of the company’s new corporate debt in the first half of the year exceeded $50 billion.
At the end of July, Alphabet raised its annual capital expenditure forecast to $195–205 billion from $180–190 billion. A significant portion of these funds will be directed towards expanding its artificial intelligence infrastructure.
Since the start of the year, the company’s market capitalisation has risen by almost 15 per cent, to $4.42 billion.