NEW YORK (Bloomberg) — Microsoft Corp. is planning to sell debt this year to pay for dividends and share repurchases because too much of its cash is held overseas, according to a person familiar with the matter.

The company would try to raise as much as it can without jeopardising its debt rating of AAA, the highest possible, said the person, who declined to be named because the plans are confidential and not completed. Microsoft could probably issue as much $6 billion more in debt without putting its rating at risk, according to data compiled by Bloomberg.

Chief executive officer Steve Ballmer is under pressure to return some of the company's $36.8 billion in cash and short term investments to investors in the form of dividends or share buybacks. Much of that is held overseas, requiring Microsoft to pay taxes on money brought home. The software maker would follow Home Depot Inc. and Dell Inc., which issued bonds this month as investment-grade borrowing costs hover near record lows.

"They obviously think their stock is cheap and getting debt is cheap, so why not issue debt," said Jason Brady, a managing director at Thornburg Investment Management. The company can issue at least $5 billion of new debt without putting its rating at risk, he said. Thornburg, in Santa Fe, New Mexico, oversees more than $56 billion, including Microsoft shares.

A debt offering may come before the end of the company's fiscal year, which closes next June, and could come as soon as this calendar year, the person said.

Microsoft had about $22 billion in free cash flow last fiscal year with about half of that in the US and half overseas.