Summary
On December 3, 2013, Microsoft Corporation (MSFT) announced the issuance and sale of a substantial amount of new debt securities, comprised of both Euro-denominated and US Dollar-denominated notes. This move signifies Microsoft's proactive approach to managing its capital structure and funding needs. The offering includes multiple tranches with varying maturities and coupon rates, suggesting a strategy to diversify its debt portfolio and potentially secure favorable borrowing costs. Investors should note that these new notes represent senior unsecured obligations of the company, ranking equally with other outstanding unsecured and unsubordinated debt. The issuance details highlight a significant capital markets transaction for Microsoft. The Euro Notes total €3.5 billion across 2.125% Notes due 2021 and 3.125% Notes due 2028. The USD Notes total $3.25 billion across 1.625% Notes due 2018, 3.625% Notes due 2023, and 4.875% Notes due 2043. This comprehensive debt issuance provides Microsoft with considerable financial flexibility and demonstrates its continued access to diverse funding sources in both European and US markets.
Key Highlights
- 1Microsoft issued €3.5 billion in Euro Notes (2.125% due 2021, 3.125% due 2028) and $3.25 billion in USD Notes (1.625% due 2018, 3.625% due 2023, 4.875% due 2043).
- 2The debt issuance occurred on December 3, 2013, with the filing on December 5, 2013.
- 3The notes are senior unsecured obligations and will rank equally with other unsecured and unsubordinated debt of Microsoft.
- 4The Euro Notes will pay interest annually, while the USD Notes will pay interest semi-annually.
- 5Maturities range from 2018 for the shortest USD notes to 2043 for the longest USD notes, and 2021 and 2028 for the Euro Notes.
- 6Microsoft has the option to redeem the notes under specific circumstances detailed in the prospectus supplements.
- 7The company has obtained legal opinions from its associate general counsel and external legal advisors regarding the issuance.