MicroStrategy, the largest corporate holder of Bitcoin, has announced plans to raise $2.6 billion through convertible debt offering, marking a substantial increase from its initial target of $1.75 billion. The company intends to use these funds primarily for expanding its Bitcoin holdings while addressing other corporate requirements.
The technology firm plans to offer convertible notes exclusively to institutional buyers and select non-US investors. These notes, set to mature in December 2029, will be unsecured senior obligations without regular interest payments.
The conversion terms allow holders to exchange $1,000 of principal for 1.4872 shares of MicroStrategy Class A stock, setting the conversion price at $672.40 per share. This represents a 55% premium over the November 19 average price of $433.80.
The company expects to receive approximately $2.58 billion in net proceeds after expenses. Should buyers exercise their option to purchase additional notes worth $400 million, the total proceeds could reach nearly $3 billion.
This announcement comes as MicroStrategy achieves a new milestone by entering the ranks of the top 100 US publicly traded companies, securing the 97th position. The company's stock performance has been remarkable, doubling in value over the past month and reaching a two-decade high exceeding $430.
The firm's pre-market trading indicates continued momentum, showing an approximate 8% increase. MicroStrategy currently holds over 330,000 Bitcoin, valued at more than $30 billion, reinforcing its position as the leading corporate Bitcoin holder. In 2023 alone, the company has added nearly 150,000 Bitcoin to its treasury.
The latest debt offering demonstrates MicroStrategy's unwavering commitment to its Bitcoin acquisition strategy, while its entry into the top 100 US companies highlights the growing mainstream acceptance of corporate cryptocurrency investment.