Why Apple Is Tapping the Bond Markets, Yet Again

Updated from 9:19 a.m. ET to include bond offering size and Apple share prices

NEW YORK (TheStreet) - Apple (AAPL) is selling $12 billion in debt finance an expanded stock buyback and dividend. The company said in a prospective on Tuesday it will offer debt in seven tranches, at maturities ranging from three-to-30-years.

Another Fee Bonanza Looms For Apple Debt Underwriters

 "We intend to use the net proceeds from sales of the notes for general corporate purposes, including repurchases of our common stock and payment of dividends under our recently expanded program to return capital to shareholders," Apple said in the prospectus.

According to Bloomberg News, Apple is marketing $12 billion in debt. Apple will issue floating and fixed rate debt between three and five year maturities. The company will also sell fixed rate notes at seven, 10 and 30-year maturities.

In fiscal second-quarter earnings announced last week, Apple said it would increase its existing share repurchase program authorization from $60 billion to $90 billion and increase its cash dividend by approximately 8% to $3.29 per share. The iPhone maker also said it would finance much of that expanded repurchase and dividend activity.

Funds raised from Apple's debt offering may also be used to fund working capital, capital expenditures, acquisitions and repayment short-term debt, Apple said. Goldman Sachs and Deutsche Bank will lead the bond offering, according to a Securities and Exchange Commission filing.

Apple shares were little changed at $593.22 in Tuesday afternoon trading.

A Repeat?

Apple's newest offering is of a slightly smaller size than its $17 billion debt offering in April 2013.

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