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Banking, finance, and taxes

Why Is Microsoft Selling 5, 10, and 30 Year Debt? (MSFT)

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By Douglas A. McIntyre Updated Published
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MSFT LogoThis morning came a preliminary prospectus supplemental filing from Microsoft Corporation (NASDAQ: MSFT) to sell 5-year, 10-year, and 30-year debt instruments for undisclosed terms and undisclosed amounts.

The filing shows that these notes will not be listed on any securities exchange; and that there is currently no public trading market for the notes.

Underwriters are listed as J.P. Morgan, Morgan Stanley, Citi and Banc of America Securities.

As far as the use of proceeds, that is the “general corporate purposes” explanation for funding for working capital, capital expenditures, repurchases of our capital stock and acquisitions.

When you have somewhere around $30 billion of cash and liquidity listed on the books, you have to wonder what this is for.  Maybe Microsoft has found a new large business it can buy without running into regulatory issues.  Maybe.

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We already saw an initial filing for debt back in November.

JON C. OGG

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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