MicroStrategy Plans To Raise $700M in Convertible Senior Notes

• MicroStrategy has announced its plans to raise $700 million via a private offering of convertible senior notes.
• The move comes following MicroStrategy’s recent acquisition of $1.11 billion in Bitcoin.
• The firm plans to allocate the funds to repay $500 million in outstanding senior secured notes and acquire additional BTC.

MicroStrategy, a major Bitcoin holder, has announced plans to raise $700 million through a private offering of convertible senior notes due in 2028. This move comes close on the heels of MicroStrategy’s Bitcoin acquisition worth $1.11 billion earlier.

This marks MicroStrategy’s third debt offering in 2024, aimed at expanding its Bitcoin holdings and refinancing existing debt. According to a press release, the funds will be used to repay $500 million in outstanding senior secured notes and acquire more Bitcoin, aligning with the company’s strategy of increasing its Bitcoin portfolio. The remaining funds will be used for general corporate purposes.

The proposed notes will be unsecured and will accrue interest, payable semi-annually starting March 15, 2025. They mature on September 15, 2028, unless converted or repurchased earlier. 

Initial purchasers have the option to buy an additional $105 million in notes within 13 days. The notes offer holders flexibility, with the option to convert them into cash, MicroStrategy Class A shares, or a combination of both, at the company’s discretion.

MicroStrategy’s Bitcoin Journey

This strategic move follows MicroStrategy’s recent acquisition of 18,300 Bitcoins, worth roughly $1.11 billion, between August 6 and September 12. The company purchased these Bitcoins at an average price of $60,408 per BTC. MicroStrategy and its CEO, Michael Saylor, have consistently accumulated Bitcoin over the past four years. This latest purchase brings the company’s total holdings to approximately 244,800 BTC, valued at about $14.14 billion.

Read also: Bitcoin Bulls Rejoice: Leveraged MicroStrategy ETF Gets Green Light

MicroStrategy’s first Bitcoin purchase was on August 11, 2020. Since then, the company has received both praise and criticism for its aggressive Bitcoin accumulation strategy. However, MicroStrategy remains committed to its approach, showing no signs of slowing down.