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MicroStrategy Raises $650 Million to Buy More Bitcoin

2020-12-11 16:00
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MicroStrategy has raised about $650 million in funds by completing a notes offering, with the intention of buying more Bitcoin.
The company has recently concluded its sale of $650 million worth of 0.750% convertible senior notes due 2025. It intends to invest the net proceeds from the sale of the notes in bitcoin in accordance with its Treasury Reserve Policy, according to its press release.
MicroStrategy made headlines in the cryptocurrency industry last week, when Chief Executive Michael Saylor expanded MicroStrategy's bitcoin treasury reserve to 40,824 BTC. Earlier this week, when it revealed plans to sell up to $400 million in a convertible senior notes sale. The concluded notes offering marked an increase of $250 million from initial fundraising plans for its Bitcoin purchases.
In a recent fireside chat with Binance CEO CZ (Changpeng Zhao), Saylor expanded on his reason for deciding to buy Bitcoin and why he feels so bullish about its future. During the session, the MicroStrategy revealed that prior to March, he thought of Bitcoin as a speculative asset.
“March was a wake-up call. April was a quest for the truth, to rethink everything that I believed about macro investments. By May it was clear to me that [Bitcoin] was the future," Saylor said about his change of stance.
MicroStrategy estimated that the net proceeds from the sale of the notes will be approximately $634.9 million. The conversion rate for the notes is initially 2.5126 shares of MicroStrategy class A common stock per $1,000 principal amount of notes, which is equivalent to an initial conversion price of about $397.99 per share. This represents a 37.5% premium over the last reported sale price of $289.45 per share of MicroStrategy's common stock on The Nasdaq Global Select Market as of December 8.
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