What Will Amazon Do with its Latest Bond Offering?

By Rich Steeves November 26, 2012

If you like your financial news shaken, not stirred, I have three words for you:

Bond. Amazon bonds.

In 1997, Pierce Brosnan was James Bond, and Amazon was considered a junk-rated bond issuer.

How things have changed.

Nowadays, Daniel Craig is James Bond and Amazon is a powerhouse in the industry, and planning to sell three-, five- and 10-year bonds in a deal that is expected to soar into the $2.5 billion range.


Image via Shutterstock

The proceeds will be for general corporate purposes, such as the purchase of Amazon’s corporate headquarters, according to Moody’s.

"Demand should be strong because it's a new name for the marketplace," Sean Simko, head of global fixed-income management at SEI Investments, told foxbusiness.com. Experts expect the bonds to yield .5, .75 and 1.05 percent over the three-, five- and 10-year Treasury rates.

But not everyone is excited about the offering. Andrew Hofer, portfolio manager at Brown Brothers Harriman in New York, is not impressed. "This Cyber Monday promotion is still too expensive, as much as we admire the company," he said.

Moody’s cited online retails sales as a strength for the company, helping boost its credit rating, but other factors are working against it, and Moody’s gave Amazon a AA-minus rating.

Aside from the corporate headquarters, the mind boggles at the thoughts of what Amazon might do with billions of dollars. Perhaps it is planning for the zombie apocalypse, or looking to ship extra Hostess goodies to Colorado and Washington State. Or maybe the company wants to promote books by independent authors. Only time will tell.




Edited by Braden Becker

TechZone360 Web Editor

SHARE THIS ARTICLE
Related Articles

Windy City Takes on Cloud: New Tax on Streaming Media, SaaS and PaaS

By: Laura Stotler    7/1/2015

In a bold and controversial move, the city of Chicago instituted a new cloud tax today that will target online databases like AWS as well as popular s…

Read More

Practical Step-by-Step Guidance After Your Company Has Been Hacked

By: TMCnet Special Guest    6/30/2015

Everybody tends to think that hackers will never ever target them or their company/organization-until a breach occurs. We have already published sever…

Read More

Why the Apple Watch Failed

By: Rob Enderle    6/29/2015

The Apple Watch hasn't exactly been the success the iPod, iPhone, and iPad initially were (though to be fair the iPhone and iPod weren't that great th…

Read More

Department of Defense Wants to Move Majority of Apps to the Cloud by 2020

By: Peter Bernstein    6/29/2015

It is no secret that the U.S. government wants to upgrade its IT capabilities and that moving them into the cloud is a priority. In fact, it is a mand…

Read More

HBO Now Proves Big Hit with Cable Cutters

By: Steve Anderson    6/26/2015

For those have made the jump from traditional cable service to online sources for entertainment- also known as "cable cutters" or "cord cutters"-the I…

Read More