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Off Topic => Engineering => Topic started by: Nemesis on May 12, 2009, 08:42:28 pm

Title: $25 Billion in "the bank" so why is Microsoft going into debt?
Post by: Nemesis on May 12, 2009, 08:42:28 pm

Link to full article (http://www.smartmoney.com/Investing/Bonds/What-s-Behind-Microsoft-s-Bond-Offering/?afl=yahoo)

Quote

The bonds were issued with maturities of 5, 10 and 30 years. The five-year bonds’ coupon of 2.95% was just 0.95% over comparable Treasurys. “It was the first double-digit spread I’ve seen in a year and a half,” says Bob Persons, manager of the MFS Bond fund (MBDIX), since before the credit crunch widened the risk premiums on all manner of debt. The 10-year bonds’ coupon of 4.2% and the 30-year bonds’ coupon of 5.2% were both 1.05% over comparable Treasurys.

Title: Re: $25 Billion in "the bank" so why is Microsoft going into debt?
Post by: SkyFlyer on June 06, 2009, 04:38:24 am

Acquisition? Or perhaps they are foreseeing a financial situation where they will not be able to borrow in the future? It's a lot of liquidity but who knows.

Title: Re: $25 Billion in "the bank" so why is Microsoft going into debt?
Post by: Dracho on June 08, 2009, 11:48:10 am

And you never spend your own money when you can spend someone else's money on a risky venture.

Title: Re: $25 Billion in "the bank" so why is Microsoft going into debt?
Post by: Centurus on June 15, 2009, 04:21:51 pm

I wonder if these are also non resource monies.  If they are, then if things go belly up, they can write it off as a loss and not have their credit hit.