Microsoft to raise $3.35 billion via bond sale

(REUTERS) - Microsoft Corp priced its US$2.7 billion (S$3.35 billion) bond offering, sold in the United States (US) and Euro markets, as it is rushing in before larger rival Apple Inc looks to raise money from the bond market to fund its mammoth US$100 billion capital return programme.

Microsoft, which is raising 550 million euros (S$888 million) in Europe and US$1.95 billion in the US market, is one of many US corporations taking advantage of low interest rates to borrow money.

The offerings announced on Thursday are expected to close on May 2, 2013. Microsoft intends to net proceeds from the offerings to repurchase stock, acquisitions and repayment of existing debt.

After Apple's announcement on Tuesday, the iPhone maker could go from being the only major technology company with no debt on its books to one that issues as many bonds as a major global bank.

Microsoft - world's largest software company - is not short of liquidity, with US$69 billion in cash and short-term investments on its balance sheet, largely held outside of the US.

In November, Microsoft raised US$2.25 billion in the US bond market, according to IFR, Thomson Reuters news and market analysis service.