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On Monday, U.S.-based Microstrategy, the publicly traded business intelligence (BI) company, unveiled plans for a private offering of $700 million in convertible senior notes. The BI firm plans to raise capital to pay off existing debt and purchase more bitcoin.
Microstrategy Reveals Another Private Offering
According to Microstrategy’s (Nasdaq: MSTR) announcement, the notes, set to mature in 2028, will be offered to institutional investors, pending market conditions. Microstrategy intends to use the proceeds to redeem $500 million in senior secured notes and, if any funds remain, to further grow its bitcoin (BTC) holdings.
MSTR shares slid on Monday 4.91% but over the past week, the stock is up 9.37%. The senior secured notes, totaling $500 million with a 6.125% interest rate, are scheduled for redemption on Sept. 26, 2024, if the offering is successful.
Secured by 69,080 bitcoins, the notes will be released upon repayment. Microstrategy reaffirmed its strategy of leveraging bitcoin as a key treasury reserve asset, while actively increasing its BTC holdings.
This offering comes on the heels of Microstrategy’s recent acquisition of 18,300 bitcoins for $1.11 billion, bringing its total bitcoin holdings to 244,800 BTC. Now valued at $14.15 billion, the company’s bitcoin portfolio has seen a 50% gain, driven by a combination of strategic fixed-interval purchasing and bitcoin’s price growth.
Microstrategy’s focus on balancing debt reduction with bitcoin accumulation continues to be central to its broader financial goals. Apart from exchange-traded funds (ETFs) like Blackrock‘s IBIT and Grayscale’s GBTC, Microstrategy holds the most bitcoin of any publicly traded company worldwide.
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