On Sept. 16, MicroStrategy founder Michael Saylor announced the company's plans for a new $700 million debt offering in the form of convertible senior notes.
New Capital Raising Plans
The $700 million figure is the aggregate principal amount, with an option for an additional $105 million issuance. The notes will mature in September 2028. The company stated that it intends to use the net proceeds to pay off existing debt and redeem $500 million in outstanding senior secured notes.
Increasing Bitcoin Reserves
Part of the proceeds from the debt offering will be used to acquire additional bitcoin, underscoring the company's commitment to its BTC strategy. "Any balance of the net proceeds will be used to acquire additional bitcoin and for general corporate purposes," it stated.
Financial Data and Previous Offerings
Convertible senior notes are a type of debt security that can be converted into the issuing company's equity under certain circumstances. This is MicroStrategy's third debt offering in 2024: $700 million was raised in March, and another $500 million in June. The company currently holds 244,800 BTC worth around $14.24 billion. Their latest acquisition amounted to 18,300 BTC for $1.1 billion, announced on Sept. 13.
MicroStrategy continues to aggressively increase its bitcoin reserves despite market volatility and the decline in its stock price.
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