MicroStrategy just completed a $3 billion debt offering to buy more bitcoin! ๐ They previously announced they would issue convertible senior notes due 2029 with 0% interest. ๐ฎ
The offering was surprisingly quick, closing in just three days! โฑ๏ธ They originally wanted to raise $1.75 billion, but eventually increased the amount to $2.6 billion, plus an option for early adopters to take an additional $400 million. ๐ธ
While the bonds are interest-free, investors may be interested because they have a conversion ratio of 1.4872 shares per $1,000 principal, which works out to about $672 per shareโthatโs 55% higher than their recent stock price. ๐
Like their previous debt offerings, MicroStrategy plans to use the proceeds to buy bitcoin. ๐ฐ Since they started investing in 2020, investors have been looking at MSTR stock as a way to invest in bitcoin. They currently hold 331,200 BTC worth over $30 billion after announcing their largest bitcoin purchase this week. ๐ค
MicroStrategy bought bitcoin at an average price of $49,874 per coin, totaling $16.5 billion. ๐ต They plan to raise $42 billion through debt and stock offerings to buy more bitcoin. ๐From the latest convertible note sale, MicroStrategy raised about $2.97 billion after fees and expenses. ๐ Investors can then exchange these notes for cash, MicroStrategy Class A shares, or a combination of the two, at the companyโs option. ๐These notes are generally not convertible before June 1, 2029, unless certain conditions are met. For example, if MicroStrategyโs stock price rises 30% above the conversion price before December 2026, the company could buy back the notes for their original value plus accrued special interest.
