Printing-ink veterans don't take cyberspace journalists too seriously - Roy Greenslade, Guardian Online
CHIPMAKER Intel has raised $6bn in a bond sale, which the firm will use to buy back its own stock.
Intel's position as a bellwether technology company means that it can generate cash easily by issuing bonds, as it has done on several occasions. Now Bloomberg's data shows the firm managed to ring up $6bn from its most recent bond sale, which will be used to buy back its stock.
Intel's share buy-back programme has been going for a number of years and such programmes are used by management to buoy share prices and promote long-term stability. In the case of Intel its stock price, which has been trading close to 52-week lows, jumped by 2.2 percent to $19.97, though it is still quite a way shy of its high for the year of $29.27.
Intel announced its latest bond issue yesterday but didn't reveal pricing or yields, simply saying that it will use the cash for "general corporate purposes" and to buy back more of its stock. Standard and Poor's rated Intel's latest bond issue as A+ while Moody's rated it at A1, meaning that the firm should have little trouble attracting institutional investors.
Details of Intel's latest bond issue are likely to emerge next year, with Bloomberg claiming it will offer 20-year bonds at 130 basis points. Although Intel is facing stiff competition from ARM vendors, the firm is still seen as the measure of the semiconductor industry and therefore needs to maintain an image of long term stability in order to please institutional investors like Blackrock, which has a sizeable stake in the company. µ
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