Friday, August 12, 2022

Meta’s first bond issue to raise 10 billion yuan is oversubscribed 3 times

Facebook parent Meta raised $10 billion by selling four corporate bonds with different maturities, the social media giant’s first offering as cash flow declined last quarter andrevenueposition of the first drop.

Bloomberg quoted sources as saying that among the corporate bonds that Met plans to issue, the longest maturity is 40 years.yieldThis is the U.S. The Treasury yield would be 1.6 percentage points higher than that, a fine tune of 1.8 percentage points from the 1.75 discussed initially. At one point in New York, Meta raked in up to $30 billion in subscriptions, sources said.

The report said the sudden change in the issuance position of META’s corporate bonds could be related to operating conditions. Meta’s revenue shrank compared to a year ago last quarter, the first contraction on record amid uncertainty in the digital advertising market. Meta has relied on its advertising business for many years to drive its growth.

Meta’s cash flow fell to $23.6 billion from a year earlier, according to data compiled by Bloomberg, making it one of the biggest losses among non-financial companies in the S&P 500.

While many tech giants have taken advantage of low interest rates to go on a debt spree with cash, Meta has only now followed suit. According to data compiled by Bloomberg, Meta is one of only 18 S&P 500 companies that haven’t issued long- or short-term corporate bonds as of last quarter.

Over the past month, the credit market has stabilized and bond prices have soared. Tech giants like Apple and Intel have seized on this potentially fleeting opportunity and issued bonds one after the other.

Standard & Poor’s Global, an international credit rating agency, has released Meta’sinvestMoody’s Investors Service gave Meta an AA- and Meta an A1 rating, which is one notch below S&P Global.

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