Alphabet Raises Record Yen Bonds in Japan Debt Market Move

Key Moments

Record Yen Deal by a Foreign Issuer

Alphabet has completed a 576.5 billion yen ($3.6 billion) offering of yen-denominated bonds, according to a term sheet released on Friday in Tokyo. The size of the transaction makes it the largest yen bond deal ever completed by a non-Japanese company.

This transaction represents Alphabet’s debut in the yen bond market. The company, alongside other major technology firms, is pursuing a substantial investment program in artificial intelligence and is broadening its funding base across multiple currencies.

Strategic Funding Amid Heavy AI Investment

Alphabet, the parent company of Google, has indicated capital expenditure plans of up to $190 billion this year. In line with its strategy to diversify borrowing sources, the company has already issued bonds in euros, sterling, Canadian dollars, and Swiss francs, and is now adding yen to that mix.

Investor Demand and Market Context

Mizuho Securities, one of the underwriters, reported robust interest in the bonds from both Japanese and overseas investors. The firm said the transaction surpassed the previous record for a foreign issuer in the yen market – a 430 billion yen deal by Warren Buffett’s Berkshire Hathaway in 2019.

Deal Structure and Pricing

The term sheet detailed a broad maturity profile, with bonds extending from the short to ultra-long end of the curve. Coupon rates vary by tenor within a defined range.

Bookrunners and Syndicate

Mizuho Securities, Bank of America and Morgan Stanley are serving as joint bookrunners on the yen bond transaction.