Amazon raised $10 billion in the bond markets, including $1 billion of debt yielding just 0.4% — reportedly the lowest rate in the history of US corporate bonds

The Financial Times reported that this was the lowest interest rate for any bond in US corporate history.
Amazon, which has clearly come out as a winner during the pandemic, saw its $10 billion offering being oversubscribed by more than three times, the FT said.
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Amazon benefited from the cheapest ever borrowing costs in the US corporate bond market on Monday, the Financial Times reported.

In a remarkable turn for the company whose bonds were considered junk in 2009, Amazon raised $10 billion in the bond markets at extremely low rates, including a new three-year debt offering with an interest rate of only 0.4%.

The three-year bond was worth $1 billion of the total issuance, according to bond information website Cbonds.

Amazon's new interest rate is reportedly below a prior record-low of 0.45% secured by some companies such as Apple, IBM, and Walt Disney in 2012 and 2013.

The company's $10 billion offering was oversubscribed by more than three times, the FT said, citing unnamed sources. The newspaper added that Amazon said the money will be used for "general corporate purposes."

The last time the e-commerce giant tapped bond markets it issued a three-year bond at an interest rate of 1.9% in 2017, the FT said. At the time it was raising money to fund its purchase of Whole Foods.

Read More: GOLDMAN SACHS: Buy these 25 beaten-down stocks all poised to jump more than 18% from current levels Amazon has come out as one of the biggest winners during the worsening business climate of the coronavirus pandemic, as consumers looked to e-commerce retailers for general shopping and essentials. In April, Amazon reported a 26% revenue spike in its first-quarter financials to $75.5 billion, but its costs increased as the company had to implement additional safety measures and hike pay for warehouse employees. According to Cbonds , the bonds issued by Amazon were as follows: A $1 billion bond for three years, yielding 0.4%. A $1.25 billion bond for five years, yielding 0.8%. A $1.25 billion bond for seven years, yielding 1.2%. A $2 billion bond for 10 years, yielding 1.5%. A $2.5 billion bond for 30 years, yielding 2.5%. A $2.5 billion bond for 40 years, yielding 2.7%. The bonds were underwritten by a variety of banks, according to Cbonds, including JP Morgan, Goldman Sachs, Deutsche Bank, HSBC, Citigroup, Morgan Stanley, Societe Generale, TD Securities, and Wells Fargo. Amazon did not immediately respond to a request for comment from Markets Insider on the debt issuance. Read More: MORGAN STANLEY: The market's hottest stocks are in danger of being disrupted to a degree not seen since the Great Recession. Here's how to adjust your portfolio for the coming shift. NOW WATCH: How waste is dealt with on the world's largest cruise ship See Also: The European Union's $826 billion stimulus plan to battle the coronavirus is 'too small and too late,' analysts say 'Embrace the coming crash': A notorious market bear who called the dot-com bust warns big tech stocks are on the verge of succumbing to the economy's downturn BANK OF AMERICA: Buy these 13 under-the-radar tech stocks poised to outperform amid flaring China tensions and lasting pandemic damage SEE ALSO: Global stocks jump as analysts say widespread protests in the US will have 'little to no effect' on markets

Amazon raised $10 billion in the bond markets, including $1 billion of debt yielding just 0.4% — reportedly the lowest rate in the history of US corporate bonds

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