According to two sources close to the deal, facebook-parent Meta Platforms Inc. is set to raise $10 billion in its first bond offering on Thursday, as it funds share buybacks and investments to improve its business.
Sources said the offering includes bonds with maturities ranging from five years to 40 years and has received orders worth over $30 billion from investors. He said the demand was inclined towards long-term bonds.
Meta did not respond to a request for comment.
Among the large technology companies, Meta was the only company that did not have debt on its books. Tapping the market now will help it build a more traditional balance sheet.
Sources said this could give it more financial room as it tries to fund costly initiatives, such as its Metaverse virtual reality and Reels short video products, when its cash pile is running low.
The sources, who declined to be named as they were not authorized to speak publicly, said Meta started working earnestly on the offering over the last couple of months.
They said it decided to launch the offering after releasing earnings in late July. The varying maturities of its offering would give it more funding options in the future, they added.
The sources said that a recent resurgence in corporate bond markets over the past month after a rout earlier this year amid uncertainty about interest rates gave Meta a window to tap the market now.
Hoping the U.S. Federal Reserve’s fight against inflation through aggressive rate increases was starting to have some impact, investors have rushed back into the bond market.
According to Informa Global Markets data, this week has been one of the years, with U.S. investment-grade companies raising nearly $60 billion in primary bond markets.
Other tech giants such as Apple Inc and Intel Corp also issued bonds earlier this week, raising $5.5 billion and $6 billion, respectively.
