Apple sells 30-year bond in Taiwan at 4.15 percent yield: Sources


Apple sold a 30-year U.S. dollar bond in Taiwan at a yield of 4.15 percent, sources said on Tuesday, aiming to raise between $1 billion and $1.2 billion in the first issue of debt by the U.S. technology giant on the island that is home to major players in its supply chain.

The yield compares with a range between 4.2 percent to 4.3 percent ahead of its pricing, people familiar with the deal earlier told Reuters. At 4.15 percent the yield is well below that offered in recent bond issues in the flush Taiwanese market by blue-chip multinationals like Intel and Anheuser Busch InBev.

Rescue workers search through the explosion site in southern Kaohsiung city on August 1, 2014. A series of powerful gas blasts killed at least 22 people and injured up to 270 in the southern Taiwanese city of Kaohsiung,
SAM YEH I AFP I Getty Images

The total amount raised by the bond — callable after the second year — had not yet been finalized, the people said, speaking on condition of anonymity because the matter was confidential. Subscriptions rates in the sale couldn't immediately be determined.

Apple could not be reached immediately for comment on the issuance in Taiwan, which houses Apple suppliers including iPhone assembler Foxconn, formally known as Hon Hai Precision Industry Co., contract chipmaker Taiwan Semiconductor Manufacturing Co. and lens producer Largan Precision Co.

The U.S. giant joins a crowd of big global names that have sold billions of dollars on the island's busy debt market. Liquidity in the Taiwanese bond market is high, with long-term buyers of debt, primarily life insurance firms, seeking creditworthy names and chasing higher yields.

Apple CEO, Tim Cook
Robert Galbraith | Reuters

Cathay Financial Holding Co., the parent of Taiwan's biggest life insurer, has bought "a small part" of the bond as the yield is lower than others issued by Apple outside of Taiwan, a Cathay executive told Reuters by phone. He asked not to be identified as he was not authorized to speak to media.

In December, U.S. chipmaker Intel sold $915 million of 30-year bonds with yields of 4.7 percent. A month later, global brewer Anheuser Busch InBev issued a $1.47 billion bond of the same maturity at 4.915 percent, according to data from the Taipei Exchange, the island's over-the-counter market.

The island's 30-year government bond, which is less liquid in the secondary market, was last quoted around 1.6475 percent.