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

Banking, finance, and taxes

Published: May 11, 2009 8:14 am

Last Updated: April 28, 2020 10:20 am

This 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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