MicroStrategy (ticker: MSTR), a business intelligence firm turned Bitcoin trading house, plans to sell up to $700 million in convertible bonds to fund additional BTC purchases and bond repurchases, CEO Michael Saylor announced.
The private offering will be conducted “subject to market conditions” and mature in 2028. The notes are MicroStrategy’s unsecured preferred notes (a type of debt that is not backed by collateral) and bear interest twice annually.
As of June 2024, MicroStrategy’s total debt is $3.9 billion. The company purchased 244,800 BTC worth approximately $10 billion, which includes: 18,300 Bitcoin According to filings with the U.S. Securities and Exchange Commission, more than $1 billion worth of purchases were made last week.
“MicroStrategy intends to use the net proceeds from this offering to repay the entire outstanding principal amount of MicroStrategy’s 6.125% Senior Secured Notes due 2028 (the “Senior Secured Notes”), and use the remainder of the net proceeds to acquire additional Bitcoin and for general corporate purposes,” the company said in a statement.
The company has acquired a total of $9.5 billion worth of Bitcoin since it began buying in 2020, paying an average of $38,585 per coin.
MicroStrategy shares fell 4.9% on Monday.
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About the Author
Daniel Kuhn is a senior journalist and editor at The Block, covering the cryptocurrency industry with a particular focus on technology. He previously served as an associate editor at CoinDesk, where he covered the opinions/articles section. He was first published in the trade publication Financial Planning. Before pursuing journalism, he studied philosophy as an undergraduate, English literature as a graduate student, and business and economic reporting at NYU’s professional program. You can connect with him on Twitter and Telegram @danielgkuhn, or find him on Urbit as ~dorrys-lonreb.