Alphabet raises over $30 billion through global bond sale, including rare 100-year debt
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Alphabet Inc. has raised more than $30 billion through a series of global bond sales, including rare ultra-long debt offerings, as the Google parent increases spending on artificial intelligence and digital infrastructure.
The company raised about $20 billion through a multi-tranche U.S. dollar bond offering, with maturities ranging from short-term notes to bonds extending into the 2060s. The sale drew exceptionally strong investor interest, with total orders exceeding $100 billion, allowing Alphabet to increase the size of the offering.
Alongside the dollar issuance, Alphabet launched a sterling-denominated bond sale worth about £5.5 billion, which included a £1 billion bond with a maturity of 100 years. The offering also included several other long-dated bonds, including 50-year notes. The century bond is among the longest corporate debt instruments issued by a major technology company in recent decades. The last tech company to issue a century bond was Motorola in 1997.
Alphabet also issued bonds in Swiss francs, raising roughly 3.055 billion Swiss francs. Together, the U.S. dollar, sterling and Swiss franc offerings brought the company’s total fundraising from global debt markets to roughly $31-$32 billion, making it one of the largest corporate bond raises in recent years.
What are the interest rates for these bonds?
The interest rate on the US dollar bonds ranges from 3.70% to 5.75%, in the span of 3 years to 40 years of maturity. For the total principal of $20 billion raised from the US dollar bonds, the total interest rate over all lifespans is approximately $13.20 billion. Annually, that means Alphabet will pay around $960.63 million.
The 100-year bond also highlights the scale of long-term borrowing. Based on the reported 6.125% coupon rate, Alphabet will pay about £61.25 million annually in interest on the £1 billion century bond. Over the full 100-year life of the bond, total interest payments would reach roughly £6.125 billion, meaning Alphabet would repay about £7.125 billion in total by the time the bond matures in 2126. Meanwhile, the interest rates over the span of 100 years, which is divided into five trances, ranges from 4.125% to 6.125%.
According to Bloomberg, the expected £750 million ($1 billion) century bond alone attracted over £5.75 billion in orders, more than seven times the amount offered. It was the most sought-after part of Alphabet’s £5.5 billion sterling deal, which drew a record £30 billion in total bids.