TechWag

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Microsoft recently completed a bond sale for 3.8 billion dollars, which is a first for the software company. Once debt free, Microsoft will now be servicing the bonds for the duration that they exist. Of course this has generated all sorts of speculation, but also shows that for the right kind of risk, investors are still open to putting money in a company. With Microsoft’s share price down 34% for the year, this makes an alternative and attractive way of investing in Microsoft.

The odd part and this is what is fueling the speculation that Microsoft is going to go on a buying spree is that they are already sitting on 25 billion in cash, not including the hard assets of the various campuses that they own, and other investments they could tap if they needed to. While 3.8 billion might not be considered a lot of money to Microsoft, this would allow them to pick up promising, but fire sale price reduced startups, make new partnerships or outright acquisitions of larger companies possible. Cash is king, and Microsoft stock has been flat lined for years making it a long play, but not a stock that is going to keep on going up by double digits every year.

That last part is stirring lots of speculation, with Reuters pointing to business software giant SAP as a possible Microsoft acquisition target. Of course, there’s always the possibility of a Yahoo deal or partnership to consider. But others are hoping the company will use the funds to buy back more of its own shares, reaccelerating an initiative that has been under way for a few years. Source: Techflash

In all it makes for interesting rumor mongering, but in the longer run, few will know what Microsoft will really do with the cash right now. From buying back its own stock, to purchasing Yahoo, or purchasing SAP, there are many companies out there that would be beneficial to Microsoft to own. Until Microsoft does something, no one will know outside the executive level. Although this is also going to also inflame concerns with the employee draw down, contractor draw down, and cut in contractor pay that has also happened. Mini-Microsoft’s last entry (and one you want to read) is about the layoffs, and how Microsoft has continued to hire for the right positions even though they are letting some people go.