MicroStrategy has upsized its convertible note offering to $2.6 billion to fund Bitcoin acquisitions.
MicroStrategy Expands Note Offering
The private offering was initially planned at $1.75 billion and is expected to close on November 21, 2024, pending customary conditions. The MicroStrategy convertible notes are being sold to qualified institutional buyers under the Securities Act. Initial purchasers have the option to acquire an additional $400 million in notes within three days post-issuance. At full exercise, gross proceeds would reach $2.97 billion with net proceeds of approximately $2.58 billion after deductions.
Plans for Use of Proceeds
The MicroStrategy convertible notes are unsecured senior obligations, accreting in value, and do not bear regular interest. They will mature on December 1, 2029, subject to redemption from December 4, 2026, under certain conditions. The net proceeds from the sale of the notes are intended to acquire additional Bitcoin as part of the corporate strategy and for general corporate purposes.
Redemption Conditions
The redemption will be triggered when the company's class A common stock trades at least 130% above the conversion price over a specified period. If less than all of the notes are redeemed, at least $75 million in aggregate principal should remain outstanding.
MicroStrategy continues to reinforce its strategy of investing in Bitcoin by increasing its note offering, enabling the company to channel funds into digital asset purchases and sustainable corporate growth.
