Amazon To Raise $15B Via Bond Sale To Tap Cheaper Borrowing Costs: Bloomberg

Cash-rich e-commerce retailer Amazon.com Inc AMZN is selling bonds for debt refinancing and stock repurchase, capitalizing on the cheaper borrowing costs, Bloomberg reports.
Amazon is issuing debt in as many as eight parts totaling $15 billion with the longest maturity 40-year security, yielding around 115 basis points over Treasuries.
The offering proceeds will be utilized for general corporate purposes, including acquisitions and working capital. The two-year bond will be assigned for eligible green or social projects, including clean transportation, renewable energy, and sustainable buildings.
The company held over $73 billion in cash, equivalents, and marketable securities as of March end.
Amazon had last borrowed $10 billion for general corporate purposes in June 2020. The company sold $16 billion of bonds in 2017 to finance the Whole Foods Market Inc acquisition.
Amazon has been building new global warehouses and cloud-computing data centers to meet the pandemic-induced demand from online shoppers and businesses turning to remote work. Property and equipment spending more than doubled to $45 billion in the March year-end, up from $20 billion.
Amazon’s board had authorized $5 billion in share buybacks in 2016, which has not been activated yet.
Citigroup, JPMorgan Chase, Morgan Stanley, and Wells Fargo are managing the bond sale.
Price action: AMZN shares traded lower by 2.25% at $3,217.05 on the last check Monday.