Key Points
- MicroStrategy has finalized its $1.01 billion offering of convertible senior notes due in 2028.
- The funds raised will be used to acquire additional Bitcoin and for general corporate purposes.
MicroStrategy has successfully concluded its offering of convertible senior notes, which are set to mature in 2028. The offering totalled $1.01 billion, and the announcement came less than a week after the sale was initially declared.
The notes were purchased by institutional investors under Rule 144A of the Securities Act. The net proceeds from the sale are earmarked for the acquisition of additional Bitcoin and for other corporate uses.
Details of the Offering
The notes were issued by the Virginia-based company at a 40% premium over its common stock price. The initial conversion price was set at roughly $183.19 per share. MicroStrategy also exercised an option that allowed for an additional $135 million in notes to be issued, bringing the total to $1.01 billion.
The capital raised will be utilized to redeem the company’s $500 million 6.125% senior secured notes due 2028, which were originally secured with 69,080 BTC. The remaining funds will be directed towards purchasing more cryptocurrency and for other corporate purposes. These notes can be converted into cash, common stock shares, or a combination of both, depending on MicroStrategy’s discretion.
MicroStrategy’s Bitcoin Strategy
Despite market volatility, MicroStrategy, founded by Michael Saylor, continues to invest heavily in its Bitcoin strategy. The company is one of the largest institutional holders of Bitcoin, holding approximately 244,800 BTC as of September, valued at over $15.4 billion. This offering follows MicroStrategy’s recent acquisition of 18,300 BTC for $1.11 billion, highlighting its commitment to increase its cryptocurrency holdings.