On July 11, 2025, Broadcom Inc. (AVGO, Financial) announced a significant financial development by repaying all outstanding obligations under its existing credit agreement. This move was facilitated by the issuance of $6 billion in senior notes, marking a strategic shift in the company's debt management approach.
The existing credit agreement, originally established on August 15, 2023, provided Broadcom with a $30.4 billion term loan credit facility. Prior to its termination, the company had $6 billion in outstanding term loans under this agreement, which was set to mature in 2028. The interest on these borrowings was determined by a fluctuating rate based on the company's credit ratings.
In a strategic financial maneuver, Broadcom entered into an underwriting agreement with J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, and Wells Fargo Securities, LLC. This agreement facilitated the issuance of $6 billion in senior notes, comprising $1.75 billion of 4.600% notes due 2030, $1.75 billion of 4.900% notes due 2032, and $2.5 billion of 5.200% notes due 2035. These notes are unsecured and unsubordinated, ranking equally with Broadcom's existing and future unsecured obligations.
The proceeds from this issuance, along with cash on hand, were utilized to repay the outstanding obligations under the previous credit agreement. This strategic debt restructuring allows Broadcom to optimize its financial structure and potentially improve its credit standing.
For more detailed information regarding the terms and conditions of the notes, investors are encouraged to refer to the prospectus supplement dated July 7, 2025. This development underscores Broadcom's proactive approach to financial management and its commitment to maintaining a robust capital structure.
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