Alphabet has started marketing its first Hong Kong and Singapore dollar bonds, Bloomberg reported at 01:12 UTC on 12 November, citing a person familiar with the matter. Initial price guidance is around 4.6% to 5.5% on three Hong Kong dollar tenors and 2.75% to 4% on four Singapore dollar tenors. Reuters reported the same Singapore dollar guidance from a term sheet.
The highest of the seven, 5.5% on the 10-year Hong Kong dollar notes, is 8.71 percentage points below the 14.21% yield on CoreWeave’s 9.625% notes due 2032 in FINRA TRACE data on 11 November, as we reported. CoreWeave’s notes yield 2.6 times as much, by our arithmetic, though the two sit in different currencies.
Business Pill · Credit Spread Explained
An evergreen Business Engineer explainer on why two borrowers pay different rates. It teaches the general idea only and does not discuss Alphabet or CoreWeave.
The key insight:Alphabet’s first Hong Kong and Singapore dollar bonds opened at initial guidance of 2.75% to 5.5% across seven tranches, Bloomberg reported. The top of that range is 8.71 points below the 14.21% on CoreWeave’s 2032 notes and 1.5 to 2.0 points below the 7% to 7.5% CoreWeave’s finance chief guided for its next investment-grade loan, by our arithmetic.
Alphabet “began marketing its inaugural Hong Kong and Singapore dollar bond sale, testing investor interest at a time of increasing volatility for companies focused on artificial intelligence”, Bloomberg reported.
Bloomberg put the guidance for the 2-year, 5-year and 10-year Hong Kong dollar bonds at around 4.6%, 5% and 5.5%. For the 2-year, 5-year, 10-year and 30-year Singapore dollar notes, it put the guidance at around 2.75%, 3.25%, 3.65% and 4%. A Reuters newsflash citing the term sheet gave the same four Singapore dollar levels.
On 11 November, Reuters reported that Alphabet was looking to raise about $3 billion equivalent, and likely at least $2.2 billion, with minimum sizes under consideration of HK$8 billion ($1 billion) and S$1.5 billion ($1.2 billion), citing people with knowledge of the matter. The final size, timing and pricing had not been set, one of them said. The bonds were expected to settle on November 19.
HSBC and JPMorgan are joint global coordinators. Bank of China (Hong Kong), ICBC (Asia) and Standard Chartered are working on the Hong Kong dollar sale, and DBS, OCBC and UOB on the Singapore dollar portion, Reuters reported from the term sheet. The notes are expected to be rated Aa2 by Moody’s and AA+ by S&P. Our earlier piece covered the mandate and the tenors.
Alphabet’s seven Hong Kong and Singapore dollar tranches at initial price guidance, as Bloomberg reported on 12 November (Singapore dollar levels also from a Reuters report of the term sheet), against the yield on CoreWeave’s 9.625% notes due 2032 in FINRA TRACE data on 11 November and the yield its finance chief guided for its next investment-grade loan. Different currencies and instruments.
Two Curves From One Issuer
At the same tenor, the Hong Kong dollar guidance sits 1.85 percentage points above the Singapore dollar guidance at 2 years and at 10 years, and 1.75 points above it at 5 years, by our arithmetic. Both curves rise 0.9 points from 2 to 10 years. The Singapore dollar 30-year adds another 0.35 points, to 4%.
The two sets of notes carry the same expected ratings, according to the term sheet as Reuters reported it. Initial price guidance is the opening level of the marketing; Bloomberg and Reuters had not reported final pricing or order books when we published.
Alphabet’s initial price guidance by tenor, Hong Kong against Singapore dollar, as Bloomberg reported on 12 November (Singapore dollar levels also from Reuters’ report of the term sheet). The gaps are our arithmetic.
Set Against the Neoclouds
CoreWeave’s finance chief guided its next investment-grade loan to a 7% to 7.5% yield on 10 November, as we reported. That is 1.5 to 2.0 points above Alphabet’s highest guidance, by our arithmetic.
In their latest filings, loans and notes other than convertibles cost IREN about 8.5%, TeraWulf 8.7%, Applied Digital 7.8% and CoreWeave about 9.9%, by our earlier arithmetic. Each is 2.3 to 4.4 points above 5.5%, by our arithmetic. The comparison sets different currencies and instruments side by side: it shows the distance in headline borrowing costs, not a like-for-like credit spread.
Morgan Stanley strategist Fernanda Lima said in a note on Tuesday: “We see an improving risk-reward for HQ hyperscalers and expect more spread volatility for data center bonds and neoclouds given execution and funding risk”, CNBC reported. CNBC also reported that Lima expected the rest of the year to be quiet, with little issuance activity, if any, from AI companies.
Where It Sits in Alphabet’s Borrowing
Alphabet said in an October 29 filing that it had issued $45 billion of US dollar notes and $35.8 billion of foreign currency notes in the nine months to end-September, Reuters reported. It raised €6 billion ($6.7 billion) in euros last week. Bloomberg reported on 9 November that it has also sold bonds in Swiss francs, British pounds, Canadian dollars and Japanese yen in 2026.
With its yen and Australian dollar sales this year, $7.49 billion by our earlier sum, about $3 billion more would take its Asia-Pacific currency borrowing to about $10.5 billion, or about $9.7 billion at the $2.2 billion floor, by our sum. Its debt proceeds equalled about 65% of its capex in the latest nine reported months, by our arithmetic from its cash flow statement.
The Structural Read
As we read it, the guidance puts a price on the divide the Morgan Stanley note describes: a hyperscaler rated Aa2 and AA+ opening at up to 5.5% while the neocloud debt we tracked costs 7.8% to 9.9% and CoreWeave’s notes trade at 14.21%.
As we read the two curves, the 1.75 to 1.85 point gap between the Hong Kong and Singapore dollar tranches sits between notes with the same expected ratings from the same issuer, so it is a gap between the two currencies’ rate levels rather than a view on Alphabet.
Morgan Stanley strategist Fernanda Lima, via CNBC
“We see an improving risk-reward for HQ hyperscalers and expect more spread volatility for data center bonds and neoclouds given execution and funding risk”
Three Implications
FOR THE DEAL Reuters reported a target of about $3 billion equivalent, with HK$8 billion and S$1.5 billion minimums under consideration, and settlement expected on November 19; final pricing had not been reported when we published.
FOR ALPHABET’S FUNDING MIX About $3 billion would take its Asia-Pacific currency borrowing this year to about $10.5 billion, by our sum, after yen and Australian dollar sales.
FOR THE NEOCLOUDS CoreWeave’s 2032 notes yield 14.21% and its next investment-grade loan was guided at 7% to 7.5%, both above Alphabet’s highest initial guidance of 5.5%.
The framework reads: “the capex race is no longer a corporate spending cycle. It is a sovereign-scale financing problem dressed in tech-company clothing — and the financial architecture is starting to invert.”
As we read it, a debut in two more currencies is one piece of that financing architecture: a borrower rated Aa2 and AA+ opening at up to 5.5%, by Bloomberg’s report, while CoreWeave’s notes trade at 14.21%. The framework predates this sale and does not discuss it.
What Is Not Established
The Hong Kong dollar guidance comes from Bloomberg’s single source; we read the opening of Bloomberg’s article, and the rest is behind its paywall. Final yields, sizes and the split between tranches had not been reported when we published. Alphabet told Bloomberg on 9 November that it does not comment on market speculation. We found no prospectus supplement for these notes in Alphabet’s SEC filings at about 01:45 UTC on 12 November. This is not investment advice.
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Alphabet has opened its first Hong Kong and Singapore dollar bond sale at initial guidance of up to 5.5%, Bloomberg reported, against 14.21% on CoreWeave’s 2032 notes and a 7% to 7.5% guide for CoreWeave’s next investment-grade loan. The Hong Kong dollar tranches are guided about 1.8 points above the Singapore dollar ones at the same tenor, by our arithmetic.
A note on sourcing. We read the opening of Bloomberg’s 12 November article (the rest is behind its paywall), a Reuters newsflash on the Singapore dollar term sheet, Reuters’ 11 November report on the planned sale in full, Bloomberg’s 9 November report in full via The Edge Singapore, and CNBC’s report on a Morgan Stanley note in full via TradingView. CoreWeave and neocloud rates are from our earlier, linked pieces, built from FINRA TRACE data, an earnings call and company filings. We checked Alphabet’s SEC filing index. Differences, multiples and sums are our arithmetic. We did not contact Alphabet for this piece.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
