I would think that this makes sense from a tax perspective. The Interest on debt, according to US tax law, is write-off-able. So when you combine a tax incentiv

I would think that this makes sense from a tax perspective. The Interest on debt, according to US tax law, is write-off-able. So when you combine a tax incentive with the fact that the rates are going to be very low, and that they already have a large warchest - this isn't just free money, the gov't is essentially paying them to take this money. This deal is too sweet for any manager - who's fiduciary responsibility is to increase shareholder value - to take advantage of. Reminds me of the Yuri Milner $150K convertible note to YC companies. It's almost that good. Edit: Modigliani and Miller actually devised a 'capital structure' theory that talks about the most efficient mix of debt & equity for a company - given that there are tax incentives for one or the other. So I would imagine that theory had some impact with their decision - http://en.wikipedia.org/wiki/Capital_structure http://en.wikipedia.org/wiki/Capital_structure