MicroStrategy ups convertible note offering to $700M

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MicroStrategy ups convertible note offering to $700M MicroStrategy ups convertible note offering to $700M Andjela Radmilac · 1 hour ago

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The convertible notes will be priced with a 35% premium over MSTR.

MicroStrategy has increased its convertible senior notes offering from an initially planned $500 million to $700 million. The notes will pay 2.25% interest per year and are due in 2032.

According to the company’s statement, investors will be able to convert them into shares of MicroStrategy’s stock. The initial conversion rate is set at 0.4894 shares per $1,000 of notes, equivalent to a conversion price of about $2,043.32 per share. This is 35% higher than the average trading price of MicroStrategy’s stock on June 13, 2024, which was $1,513.46. This conversion option adds potential value if MicroStrategy’s stock price increases.

Interest payments on these notes will be made twice a year, starting on December 15, 2024. The notes will mature on June 15, 2032, meaning MicroStrategy must repay the loan by this date unless the notes are converted into stock earlier. Starting June 20, 2029, MicroStrategy can choose to buy back the notes for cash if its stock price reaches at least 130% of the conversion price

The company expects to raise around $687.8 million from this sale, or up to $786 million if the additional notes are purchased, to purchase more Bitcoin for its treasury.

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