Meta set to raise $10 billion in its first-ever bond offering
• Bonds with maturities ranging from five years to 40 years received over $30 billion of orders
Facebook-parent Meta Platforms Inc (NASDAQ: META) is set to raise $10 billion in its first-ever bond offering, Reuters reported on Friday, citing two people familiar with the matter.
The social media giant on Thursday said it would start issuing bonds to use the proceeds for capital expenditures, share repurchases, acquisitions or investments.
The offering, which included bonds with maturities ranging from five years to 40 years, received over $30 billion of orders from investors, the report said.
The news came at a time when the social media giant is making massive investments to fund its metaverse projects.
Among the high-flying mega-cap tech companies, Meta is the only one that did not have any debt on its books.
The company's free cash flow has been draining as it is speedily moving ahead with its metaverse plans.
In the second quarter ended June 30, Meta had $4.45 billion in free cash flow, compared with $8.53 billion in the prior quarter. Last week, the social media giant also reported a drop in quarterly revenue for the first time.
On a post-earnings conference call, CFO Dave Wehner said the company had a "substantial amount" in its buyback program and expects to continue with buybacks as part of its capital allocation strategy.
Meta received an 'A1' rating from Moody's and an 'AA- rating' and a 'stable' outlook from Standard&Poors.
Picture Credit: Reuters
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