According to Blockworks, MicroStrategy is planning to add to its bitcoin holdings by utilizing a $600 million private offering of convertible senior notes. The company intends to use the net proceeds from the sale of the notes to acquire additional bitcoin and for general corporate purposes. This announcement comes as bitcoin approaches its all-time high of $69,000, and MicroStrategy's stock, trading under the ticker MSTR, reaches highs not seen in over 20 years. The stock closed the day up 23% to $1,334 a share, but tumbled 5% in after-hours trading following the announcement.
The notes will be unsecured, senior obligations of MicroStrategy and will bear interest payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2024. The notes will mature on March 15, 2030, unless earlier repurchased, redeemed, or converted in accordance with their terms. Offering senior notes, which is a debt security, is a way for the company to raise funds.
MicroStrategy is well-known for its bitcoin holdings. In February, it increased those holdings to 193,000 bitcoin worth nearly $13 billion at current prices. The company added 850 more bitcoin to its balance sheet just last month. Michael Saylor, co-founder of MicroStrategy, reaffirmed his bullish stance on bitcoin, stating that 'bitcoin is the exit strategy.' Bitcoin's price has been on a tear since last week, as it flirts with its all-time high and surpasses levels not seen since 2021, while bitcoin ETFs notched record volumes.
