![]() ![]() That was a very effective application of financial engineering. Goldman Sachs Group, JPMorgan Chase, and Morgan Stanley are managing the bond sale.īack on March 9, Amazon announced a massive bout of financial engineering to halt its sagging share price: It would split its stock 20-1 and incinerate $10 billion in cash to buy back its own shares.īy the eve of the announcement, Amazon’s shares had dropped 28% from the high of $3,773 in July 2021, to $2,720 on March 8, amid endless headlines that its stock was in a “bear market.” Then on March 9, Amazon comes up with the stock split and the $10 billion cash incineration program, and WHOOSH go the shares, surging by 24% in three weeks to $3,386 by March 29, just 10% below its closing high in July. This might put the yield somewhere near 4.3%. Its yield may be 1.55 percentage point above the Treasury yield, according to Bloomberg, citing a source. As Amazon’s prior bond issues, one part of the seven parts is a 40-year bond. Amazon would raise over $12 billion - amid huge demand from investors. are still left blank, to be filled in later.īut some details have emerged. In the Prospectus that Amazon filed with the SEC today, all amounts, maturities, interest, etc. Moody’s said today that it rates these bonds A1, solidly investment grade, in line with its overall corporate rating for Amazon. Today, it disclosed that it would sell a pile of senior unsecured bonds, in seven parts, to add to its $50 billion in already outstanding bonds, in part to pay for the share buybacks. By Wolf Richter for WOLF STREET.Īmazon has a another huge bond deal in the works. ![]() What’s good for Amazon is not good for the gander.
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