HONG KONG – Alphabet has raised $A5.5billion ($F8.6b) via its inaugural Australian dollar debt issuance, according to a term sheet seen by Reuters, adding to the hectic pace of fundraising by global technology companies.
The US tech giant raised the amount by issuing 3-, 5-, 10- and 20-year bonds, the term sheet showed. The company set the coupon at 6.9 per cent for the longest tenor bond tranche, according to the term sheet.
Alphabet did not immediately respond to a Reuters request for comment.
Bids received from investors for the $A5.5b ($F8.6b) debt offering were worth more than $A18b (F28b), according to the term sheet, underscoring strong appetite for new notes from tech companies.
Global tech companies are increasingly looking to capital markets to fund their massive AI spending, after having typically relied on their large cash reserves to fund investments.
The companies are expected to spend more than $730billion this year primarily on AI, and the outlay is already squeezing cash flows. Alphabet posted its first-ever negative free cash flow in its second-quarter report in late July.
Alphabet has become the first AI hyperscaler to tap into the Australian dollar debt market and the first US large-cap tech company to issue a “Kangaroo” bond since Apple in 2016.
