Strategy, formerly known as MicroStrategy, has completed a $2 billion convertible note offering to enhance its Bitcoin reserves.
Details of the Note Offering
Strategy announced on February 24 the completion of its $2 billion private note offering. These notes carry a 0% coupon and mature on March 1, 2030. Each $1,000 note block can be converted into 2.3072 shares of Strategy's Class A common stock at $433.43 per share, a 35% premium over the current market price.
Purpose for Raising Funds
The note sale resulted in approximately $1.99 billion of net proceeds after deducting fees and estimated expenses. Strategy intends to use the net proceeds for general corporate purposes, including the acquisition of Bitcoin and for working capital.
Strategy's Plan for the Coming Years
The $2 billion note offering is part of Strategy's '21/21 Plan,' targeting $42 billion in capital over the next three years, split between equity and fixed-income securities to buy more Bitcoin. Strategy has already raised $20 billion of that $42 billion, fueling its Bitcoin buying largely through senior convertible notes and debt.
Strategy's successful $2 billion convertible note offering will enable it to continue its strategy of increasing Bitcoin holdings as part of an ambitious multi-year plan.
