MicroStrategy, led by CEO Michael Saylor, is making waves in the cryptocurrency world once again as the software company upsizes its planned convertible senior notes offering to $525 million. The company intends to use the proceeds to acquire more Bitcoin, continuing a strategy it has been pursuing since 2020.
The 0.875% convertible senior notes due 2031 were priced in a private offering to qualified institutional buyers, with an annual interest rate of 0.875% payable semiannually. Holders of the notes can require MicroStrategy to repurchase them at certain events constituting a fundamental change.
After March 2028, the company has the option to redeem the notes in cash at 100% of the principal plus accrued interest if certain conditions are met. The notes will be convertible into cash, shares of MicroStrategy’s class A common stock, or a combination of both at the company’s discretion.
With an estimated net proceeds of approximately $515 million after fees and expenses, MicroStrategy continues to aggressively accumulate Bitcoin. The company currently holds over 200,000 bitcoins worth over $13 billion, with Saylor aiming to position MicroStrategy as the world’s first “Bitcoin development company.”
MicroStrategy’s bold move to use its balance sheet to acquire Bitcoin at scale reflects a growing corporate interest in the cryptocurrency as an emerging asset class and treasury asset. As more companies explore ways to hedge against debasement and inflation, MicroStrategy’s strategy serves as a testament to the increasing relevance of Bitcoin in the financial world.
