MicroStrategy, one of the largest corporate holders of Bitcoin, has announced an increase in its convertible bond offering to $875 million.
Bond Offering Increase
On September 18, MicroStrategy announced a 25% increase in its convertible senior note offering to $875 million, up from the previously announced $700 million. The company plans to use the net proceeds to redeem all $500 million outstanding 6.125% senior secured notes due 2028 and to acquire additional Bitcoin, as well as for general corporate purposes. MicroStrategy estimates net proceeds from the offering to be approximately $864.1 million, or $997.4 million if purchasers fully exercise their option to buy an additional $135 million in notes.
Bitcoin Investments
The increase in the bond offering comes on the heels of MicroStrategy's recent purchase of 18,300 BTC for around $1.11 billion, raising its total reserves to approximately 244,800 BTC. The funds will be used to further invest in Bitcoin and support current corporate needs.
Offering Terms
The bonds, bearing an interest rate of 0.625% per annum, will be sold to qualified institutional investors and will be unsecured senior obligations. Bondholders will have the option to convert them into cash, shares of MicroStrategy’s Class A common stock, or a combination of both. The offering is expected to close on September 19, subject to customary conditions.
MicroStrategy continues to strengthen its position in the cryptocurrency market by actively investing in Bitcoin and optimizing its debt load.
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