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Microsoft prices 1st debt offer

MICROSOFT Corp priced a US$3.75-billion debt offering on Monday, a first for the world's largest software maker.

Microsoft said in a Securities and Exchange Commission filing that it is offering five, 10 and 30-year senior unsecured notes. In a press release, the company said it will sell US$2 billion of 2.95 percent notes due on June 1, 2014; US$1 billion of 4.20 percent notes due on June 1, 2019, and US$750 million of 5.20 percent notes due on June 1, 2039.

It was the first public debt offering in its 23-year history.

The software maker said it will use proceeds from the sale for general corporate purposes, including possible acquisitions and stock buybacks.

Last September, Microsoft's board authorized it to take on up to US$6 billion in debt. Standard & Poor's Rating Services gave Microsoft an "AAA" corporate credit rating.

The authorization came just before interest rates soared. Microsoft, which is sitting on more than US$25 billion in cash, could afford to wait until rates came down to make a move.

Corporate debt offerings dropped off last fall but picked up again in January. Shares of Microsoft slipped 10 cents to close earlier at US$19.32.



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