MicroStrategy has completed an approximately $1.01 billion offering of 0.625% convertible senior notes due in 2028, with plans to use a portion of the proceeds for Bitcoin acquisition.
The private offering, which concluded on Sept. 19, targeted institutional investors and enabled the conversion into cash or MicroStrategy stock.
The company also plans to use part of the funds to redeem $500 million in senior secured notes, releasing collateral that includes 69,080 Bitcoin.
On Sept. 20, according to the latest Form 8-K submitted by MicroStrategy to the United States Securities and Exchange Commission, between Sept. 13 and 19:
“MicroStrategy acquired approximately 7,420 bitcoins for approximately $458.2 million in cash, using proceeds from the Offering, at an average price of approximately $61,750 per bitcoin, inclusive of fees and expenses.”
The convertible senior notes are unsecured and carry a 0.625% annual interest rate, payable semi-annually on March 15 and Sept. 15.
According to the official MicroStrategy press release, the notes will mature in 2027 unless they are converted, redeemed, or repurchased earlier.
The publicly traded software company has set the initial conversion rate at 5.4589 shares of class A common stock per $1,000 principal amount of notes.
This conversion translates to roughly $183.19 per share, reflecting a 40% premium over the stock’s price as of Sept. 17.
MicroStrategy plans to use the raise’s approximately $997.4 million net proceeds—after fees and expenses—to fund its aggressive BTC acquisition strategy.
The remaining funds will be used for general corporate purposes but will primarily focus on increasing the firm’s BTC holdings.
Part of the net proceeds will go toward the $500 million senior secured notes, which are scheduled for redemption on Sept. 26.
On Sept. 13, MicroStrategy announced its acquisition of approximately 18,300 BTC worth $1.11 billion between Aug. 6 and Sept. 12.
The firm’s SEC filing stated that the purchase was made at an average price of $60,408 per BTC.
Michael Saylor, co-founder and executive chairman of MicroStrategy, announced in an X post that the firm had achieved a BTC yield of 4.4% quarter to date and 17% year to date, holding 244,800 BTC as of Sept. 12.
