MicroStrategy plans to offer $600 million of convertible senior notes to buy more Bitcoin

MicroStrategy announced plans to sell the convertible debt to buy more bitcoin. The business intelligence firm said it expects to grant initial purchasers of the notes an option to buy an additional $90 million, making the total potential offering $690 million.

“The notes will be unsecured, senior obligations of MicroStrategy and will bear interest payable semi-annually in arrears on February 15 and August 15 of each year, beginning on August 15, 2021. The notes will mature on February 15, 2027, unless earlier repurchased, redeemed or converted in accordance with their terms. Subject to certain conditions, on or after February 20, 2024, MicroStrategy may redeem for cash all or a portion of the notes”, the press release said.

“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, at MicroStrategy’s election,” added.

Under the leadership of chairman and CEO Michael Saylor, MicroStrategy became an early adopter of companies buying bitcoin as an investment. The company disclosed its first purchase of the cryptocurrency in August, acquiring 21,454 bitcoins using existing cash on its balance sheet.

The Nasdaq-listed company already owns nearly 72,000 units of bitcoin, as of Feb. 2.

After the announcement, MicroStrategy’s share price had risen more than 5% in premarket trading.

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