MicroStrategy, the leading American software technology firm, has successfully concluded an $800 million convertible note offering, reinforcing its commitment to Bitcoin. The private offering, initiated on March 6 amidst Bitcoin’s record high, closed on March 8, with the proceeds utilized to acquire an additional 12,000 BTC for MicroStrategy’s treasury reserve.
Michael Saylor, the founder and chairman, confirmed the news on social media, revealing that the net proceeds from the note offering, along with excess cash, were invested in acquiring the new Bitcoin holdings. The average price per BTC in this transaction stood at $68,477.
Before this latest purchase, MicroStrategy held approximately 193,000 BTC at an average cost of $31,544. The current balance of the Bitcoin treasury amounts to $12.9 billion, boasting an impressive return of 112% since the company’s initial foray into BTC. Saylor disclosed that MicroStrategy’s total BTC holdings now stand at 205,000, acquired for $6.91 billion at an average price of $33,706 per coin.
“This represents a premium of approximately 42.5% over the last reported sale price of $1,051.01 per share of MicroStrategy’s class A common stock on the Nasdaq Global Select Market on March 5, 2024.”
Statement from MicroStrategy
The recently issued convertible notes bear an interest rate of 0.625% per annum and are payable semi-annually from September 2024. They offer conversion options to cash, MicroStrategy stocks, or a combination of both. The initial conversion rate equates to 0.6677 shares of MicroStrategy’s class A common stock per $1,000 principal amount of notes, presenting a premium of approximately 42.5% over the last reported sale price.
In August 2020, MicroStrategy made headlines by strategically allocating a significant portion of its capital into Bitcoin. Spearheaded by Saylor, the initiative commenced with a $250 million investment for 21,454 BTC. Saylor emphasized Bitcoin’s reliability as a store of value and an attractive long-term investment compared to holding fiat currency. The company’s steadfast commitment to Bitcoin has seen its holdings grow by over $1 billion by early January 2024.
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