Apple Inc. (NASDAQ:AAPL) plans to hold a second bond sale in Taiwan, according to a filing submitted to the U.S. Securities and Exchange Commission Feb. 14.
The iPhone maker is looking to up to $1 billion through an offering of 4.300% notes due 2047, according to the filing.
Under the terms of the sale, the bonds will mature on March 3, 2047, with a yield to investors of 4.3 percent. Interest will be paid on March 3 and September 3, starting from September 3, 2017.
The notes are redeemable at the option of the company, in whole but not in part, on each March 3 on or after 2020, according to the filing.
The redemption would be at a price equal to 100% of the principal amount of the notes being redeemed plus any accrued and unpaid interest and additional amounts. The notes will also be redeemable “in the event of certain changes in the tax laws of the United States.”
The sales manager for the bond is the Taipei branch of Deutsche Bank AG, with Goldman Sachs, Morgan Stanley, and Merrill Lynch, Pierce, Fenner & Smith listed as structuring agents. The structuring agent fee will be $3 million, according to the filing.
Earlier this month, the Cupertino tech giant announced a $10 billion bonds sale in the U.S. In June 2016, the company announced the first Taiwanese bonds sale, which raised $1.38 billion, Apple Insider reported.
The company is expected to use the proceeds from the bond sale to fund its share buyback and dividend programs for its shareholders. Apple has $246 billion in cash reserves residing outside of the U.S. The company will have to pay a hefty tax to bring the foreign funds to the country. So, it seems that the iPhone maker is using the bond sales method to fund its shareholder programs, according to Apple Insider.
The publication also said that it might be possible that Apple Inc. (NASDAQ:AAPL) could move away from selling bonds if President Donald Trump institutes a “tax holiday” on multinational firms. At the company’s most recent quarterly investor call, Apple CEO Tim Cook said that such a move would be “very good for the country, and good for Apple.”