[LONDON] Having previously tapped the dollar and euro markets for considerable size, Apple is now preparing its debut Swiss franc bond.
Apple mandated Credit Suisse and Goldman Sachs for the"potential inaugural SFr benchmark bond" earlier on Monday and said a deal could follow in the near future.
The bond is unlikely to have a short tenor as Swiss investors have been pushed out to the long end of the curve by lowest interest rates across the global financial markets.
Although unlikely to approach its dollar or even the euro outings for size, the deal could still be substantial in context of the Swiss franc market. Novartis last week set a useful marker, pricing a SFr1.375bn triple-tranche deal across 10-, 15-, and 20-years - the largest corporate outing in some three years and the longest maturity issue from the sector, excluding power project bonds.
Apple would probably look at a similar multi-pronged approach with a long-end bias too, filling in a large maturity gap between its 1.4bn 1.625% 2026s and US$3bn 3.85% 2043s.
Swapped to the franc, that euro issue comes out in the swaps plus high teens area, making a similar tenor Swiss franc deal uneconomical given it would require a negative yield.
A 15-year maturity could be an option though, with the recent Novartis SFr550m November 2029s cited by one Swiss analyst as the nearest comparable.
That deal came with a 0.625% coupon at mid-swaps plus 31bp, and at Aa3/AA- is two notches lower than Apple's Aa1/AA+.
Apple raised US$17bn from its six-tranche debut trade in April 2013, and followed that with a US$12bn seven-tranche deal in April 2014 and a US$6.5bn five-tranche offer earlier this month. Its euro deal, meanwhile, totalled 2.8bn across two tranches in November last year.
Credit analysts said at the time that other currency deals from Apple were possible.