Microsoft bond issue sparks takeover rumors

May 11, 2009
A Microsoft booth at a technology fair. Microsoft launched its first bond issue on Monday, sparking rumors the US software giant was contemplating a takeover bid.

Microsoft launched its first bond issue on Monday, sparking rumors the US software giant was contemplating a takeover bid.

Microsoft, in a filing with the US (SEC), said that it would use the money for "general corporate purposes" and planned to offer five-year, 10-year and 30-year notes.

The Redmond, Washington-based company did not specify how much it hoped to raise from the bond offering, but Fitch Ratings put the amount at 3.75 billion dollars.

has already issued two billion dollars in commercial paper, or short-term debt ,under a six-billion-dollar debt authorization made by its board late last year.

Moody's Investors Service assigned a "AAA" rating, its highest, to Microsoft's offering.

"The AAA rating for the company's inaugural debt issuance reflects the company's position as the world's largest software company with a strong and defensible market position throughout its diverse core offerings" Moody's Richard Lane said.

Moody's added that Microsoft's "very strong debt protection measures are supported by over 22 billion dollars of operating profit and nearly 12 billion dollars of free cash flow in a challenging business environment."

Microsoft was rebuffed last year in a 47.5-billion-dollar bid to take over Yahoo! but management has since changed at the Internet firm and the two companies have reportedly discussed a potential partnership.

Microsoft has said repeatedly that he is open to a tieup with Yahoo! on Web search, dominated by rival Google.

Business software firm SAP was seen as another potential target for Microsoft.

Microsoft shed 0.51 percent in New York on Monday to close at 19.32 dollars.

(c) 2009 AFP

Explore further: Ticketfly buying WillCall for on-premise data

add to favorites email to friend print save as pdf

Related Stories

Rupert Murdoch, Tom Glocer support Microsoft-Yahoo merger

May 29, 2008

Two media titans, Rupert Murdoch and Tom Glocer, the head of Thompson Reuters, said they support a partnership between computer giant Microsoft and Internet giant Yahoo, after a deal between the two companies fell apart in ...

Microsoft, Yahoo! in search, ad talks

Apr 10, 2009

Microsoft and Yahoo! have held "early discussions" about possible Internet search and advertising partnerships, a leading Silicon Valley technology website reported on Friday.

Taiwan's HTC says profit down 30 percent

Apr 06, 2009

Taiwan's smartphone maker HTC Corp posted a year-on-year 30 percent fall in first quarter net profit as the global economic meltdown hit sales, the company said Monday.

Microsoft Refuses to Reveal Current Vista Sales

Apr 27, 2007

Microsoft on Thursday reported a 65 percent jump in third quarter profits, buoyed by sales of its latest operating system, Vista. Exactly how many Microsoft has sold, however, is still a mystery.

Recommended for you

Ticketfly buying WillCall for on-premise data

Aug 21, 2014

Ticketfly Inc., a San Francisco-based technology company among several posing a challenge to Ticketmaster, is acquiring WillCall Inc., a crosstown rival that turns your smartphone into a mobile wallet at live events.

HP revenue inches up after years of decline

Aug 20, 2014

Hewlett-Packard on Wednesday reported that its quarterly revenue rose for the first time in three years, nudged by improved computer sales everywhere except Russia and China.

Restaurants experimenting with pay-in-advance tickets

Aug 20, 2014

With restaurant patrons increasingly jumping on the Internet to make reservations, some high-end eateries here and across the country are adding a new tech wrinkle: having their clientele pay for their meal in advance using ...

Chip maker Infineon to buy California firm for $3B (Update)

Aug 20, 2014

German chip maker Infineon Technologies AG says it has agreed to pay $3 billion in cash for California-based semiconductor firm International Rectifier, which produces power-management components used in everything from cars ...

User comments : 1

Adjust slider to filter visible comments by rank

Display comments: newest first

not rated yet May 12, 2009
Translation: They are feeling the pain from a logarithmic reduction in new growth over the past three years, and are trying to build up a safety buffer.