EconomyMeta enters the bond market with sale for US$10,000...

Meta enters the bond market with sale for US$10,000 million

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The parent company of FacebookMeta Platforms Inc, is set to raise $10 billion in its first bond offering as it seeks to finance share buybacks and investments to revamp its business, Reuters reported with two sources close to the deal.

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The offer, which included bonds with maturities ranging from five to 40 years, it received more than $30 billion in orders from investors, the sources said. They added that demand was biased toward bonds in the longer term.

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Among the big technology companies, Goal she had been the only one without debt on her books. Taking advantage of the market now would help you build a more traditional balance sheet. That could give him more financial headroom as he tries to fund some big-ticket initiatives, like his virtual reality metaverse and short video product Reels, at a time when his cash pile is running low, the sources said.

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The sources, who declined to be named because they were not authorized to speak publicly, said Goal began to seriously work on the offer during the last few months.

It decided to launch the offer after posting earnings in late July, they said. The different maturities of its offer would give it more financing options in the future, they added.

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A recent resurgence in the markets for bonds corporate over the last month after a loss earlier this year amid interest rate uncertainty gave Goal a window to take advantage of the market now, they mentioned.

Other tech giants like Apple Inc and Intel Corp also issued bonds earlier this week, raising $5.5 billion and $6 billion, respectively.

Bankers and investors said such issuance windows may be fleeting and rare in the coming months. Credit spreads could widen later this year, increasing financing costs.

Goal Forecast

At the end of July, Goal released a gloomy forecast and posted its first quarterly drop in revenue, with recession fears and competitive pressures weighing on its digital ad sales.

Its free cash flow has been drying up as it moves forward with its plans for the metaverse, a transformative gamble that led the company to change its name to Goal last year.

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In the second quarter ended June 30, Goal it had $4.45 billion in free cash flow, compared with $8.51 billion a year ago.

The company received an ‘A1’ rating from Moody’s and an ‘AA-‘ rating and ‘stable’ outlook from S&P.

Bank of America Merrill Lynch, Barclays, JPMorgan Chase and Morgan Stanley were the joint brokers for the offering. bonds of Goal.

With information from Reuters

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Source: Elcomercio

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