According to TechFlow, on September 18, MicroStrategy announced the pricing of the issuance of $875 million of 0.625% convertible senior bonds, an increase from the previously announced $700 million. The company also granted the initial purchaser the option to purchase up to an additional $135 million of bonds within 13 days. The issuance is expected to be completed on September 19.
The new bonds will mature on September 15, 2028, with an annual interest rate of 0.625%, and interest will be paid semi-annually. The bonds can be converted into cash, MicroStrategy Class A common stock, or a combination of the two. The initial conversion price is approximately $183.19 per share, a 40% premium to the weighted average price of the stock on September 17. MicroStrategy estimates that the net proceeds from the offering will be approximately $864.1 million, and if the initial purchasers exercise their additional options in full, they can reach $997.4 million. The company plans to use the funds to redeem all of its $500 million 6.125% senior secured bonds, and the remaining funds will be used to increase its holdings of Bitcoin and general corporate purposes.
Earlier news said MicroStrategy plans to issue $700 million convertible senior notes privately.
