Google plans to sell its first bond offering on Monday, a planned 3-billion-U.S.-dollar sale to pay back short-term borrowings, U.S. media reported.
According to The Wall Street Journal, the Internet search giant will sell three-, five-, and ten-year portions later Monday via joint book runners Citigroup Inc., J.P. Morgan Chase & Co. and Goldman Sachs Group Inc..
The three-year notes may yield 0.35 percentage point more than 10-year Treasurys, the five-year debt may pay a spread of 0.45 percentage point above Treasurys and the 10-year securities may pay 0.6 percentage point above benchmarks, said the report.
At those suggested prices, Google, graded Aa2 by Moody's Investors Service and AA- by Standard & Poor's, would pay bond investors less than other AA rated companies have to offer to sell similar securities, Bloomberg reported. Bank of America Merrill Lynch index data show the average spread on AA rated bonds was 105 basis points as of May 13.
"We plan to use the proceeds to repay outstanding commercial paper and for general corporate purposes," Google spokesman Aaron Zamost said in an e-mailed statement.
Google said last Tuesday in a regulatory filing that its net income in the first quarter is 1.8 billion dollars after setting aside 500 million dollars related to the possible resolution of a U.S. Justice Department investigation on its advertising business.
According to U.S. Securities and Exchange Commission, Google's total assets in 2010 are 57.851 billion dollars.