Nvidia may be planning for its first corporate bond sale since 2021, aims to raise … - The Times of India

Nvidia is preparing to launch its first corporate bond sale in nearly five years, aiming to raise a massive sum of at least $20 billion, a report has said. According to reports from Bloomberg News, the world’s leading AI chipmaker is looking to cash in on its popularity by tapping into the investment-grade debt market for the first time since June 2021, when it raised $5 billion.Citing a preliminary regulatory prospectus filed with the US Securities and Exchange Commission (SEC), the report said that Wall Street heavyweights Goldman Sachs, JPMorgan Chase, and Morgan Stanley have been tapped to manage the multi-billion-dollar offering.What are the details of the dealWhile final dollar amounts and interest rates will not be locked in until pricing is completed, early market discussions indicate that Nvidia is structuring the deal across seven different tranches (or slices) of debt, the report notes. These bonds will feature varying maturity periods ranging from two to 30 years, with due dates stretching between 2028 and 2056. According to financial analysts, this is a strategic treasury maneuver which means that by launching this bond sale, Nvidia can pay off and replace its older, existing notes that are coming due. This will also help the company secure long-term, low-interest funding.Google-parent Alphabet sold bonds worth $20 billionEarlier this year, Google parent also sold bonds worth $20 billion in a seven-part offering that mature every few years, starting in 2029, and go all the way up to 2066.Then about three-months later in May, Alphabet returned to the European debt market with a new multi-tranche bond offering of at least €3 billion (about $3.5 billion) across six tranches. The company said it plans to invest up to $190 billion in capital expenditures this year, largely in data centres supporting the development of Al.The longest tranche in the current offering, maturing in 2063, is being discussed at around 205 basis points above midswaps, indicating investor expectations around risk and returns, Bloomberg noted.Get the latest technology news and updates. Download the TOI App.