MicroStrategy set to raise $600M via convertible notes to buy more Bitcoin

    2024.03.05 | exchangesranking | 54onlookers

    MicroStrategy, the largest corporate holder of Bitcoin (BTC), is set to raise $600 million as part of a move to buy more Bitcoin.

    The business intelligence firm confirmed the news in a March 4 statement, revealing the funds will be issued in the form of senior convertible notes.

    X post from MicroStrategy executive chairman Michael Saylor confirming the announcement. Source: X

    Senior convertible notes are a debt security that can be converted into equity at a later date. They’re “senior” to common stock in the sense that holders have priority in the event of bankruptcy or liquidation.

    MicroStrategy said it "intends to use" the net proceeds from the sale of the notes to buy more Bitcoin for general corporate purposes.

    It also expects to grant to the initial purchasers of the notes an option to purchase up to an additional $90 million aggregate principal amount of the notes.

    Related: MicroStrategy stock spikes over 20% as BTC price continues skyward

    The notes will mature on March 15, 2030, unless earlier repurchased, redeemed or converted in accordance with their terms.

    The notes will be convertible into cash, shares of MicroStrategy’s class A common stock, or a combination of cash and shares of MicroStrategy’s class A common stock.

    It comes as MicroStrategy’s stock rallied more than 2% to $1,359 on March. 4. Meanwhile, Bitcoin is currently up 8.1% to $67,480 over the last 24 hours and is fast approaching its all-time high price of $69,000, reached on Nov. 10, 2021, according to CoinGecko.

    MicroStrategy's change in share price on March 5. Source: Google Finance

    MicroStrategy is now up a massive 172% over the month.

    The firm’s founder and executive chairman, Michael Saylor, has been the mastermind behind MicroStategy’s Bitcoin investment strategy. The firm currently holds 193,000 BTC, worth $13 billion at current prices, according to BitcoinTreasuries.

    With an average buy price of $31,550, MicroStrategy is up nearly $7 billion on its investment.

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    This is a developing story, and further information will be added as it becomes available.

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