MicroStrategy increases the issuance scale of its zero-coupon convertible senior notes to 2.60 billion USD, with a portion of the net proceeds to be used for purchasing Bitcoin.
Powered by ChatGPTPANews reported on November 19 that, according to an announcement on MicroStrategy's official website, MicroStrategy has priced its $2.60 billion zero-coupon convertible senior notes due in 2029, which is an increase from the previously announced $1.75 billion total principal amount of notes. This offering is expected to be completed on November 21, 2024, subject to customary closing conditions.
The initial conversion rate for the notes is 1.4872 shares of MicroStrategy Class A common stock for every $1,000 principal amount of notes, which corresponds to an initial conversion price of approximately $672.40 per share. The initial conversion price represents a premium of about 55% over the volume-weighted average price of MicroStrategy Class A common stock in the United States during the period from 1:30 PM to 4:00 PM Eastern Standard Time on November 19, 2024 (which was $433.7997). The conversion rate will be adjusted based on the occurrence of certain events.
MicroStrategy estimates that the net proceeds from the sale of these notes, after deducting discounts and commissions to the initial purchasers and estimated offering expenses payable by MicroStrategy, will be approximately $2.58 billion (or approximately $2.97 billion if the initial purchasers fully exercise their option to purchase additional notes). MicroStrategy intends to use the net proceeds from this offering to acquire more Bitcoin and for general corporate purposes.