As a seasoned crypto investor with a keen interest in MicroStrategy’s Bitcoin strategy, I find this latest announcement both exciting and intriguing. MicroStrategy’s decision to offer convertible senior notes to raise funds for purchasing more Bitcoin is a bold move that aligns with their long-term investment thesis.
MicroStrategy intends to issue convertible senior notes amounting to $500 million, which will be utilized to acquire more Bitcoin. The maturity date for these notes is set at 2032, as per the announcement made on Thursday.
On Thursday, MicroStrategy announced its intention to sell convertible senior notes to qualified institutional buyers. These notes, which have a maturity date in 2032 and don’t require collateral, are an unsecured debt offering from the company.
The company indicated that the terms of the private placement are contingent upon market influences and various other considerations. These securities will carry an interest rate, which will be due and payable twice a year on June 15th and December 15th.
The maturity date for these notes is June 15, 2032. However, they may be bought back, redeemed, or transformed in accordance with the terms of the offering before then.
MicroStrategy, could, subject to conditions, redeem for cash, all or some of the notes.
On June 15, 2029, noteholders have the option to ask MicroStrategy to buy back their notes in cash, either fully or partially. (MicroStrategy is a US-based company.)
MicroStrategy will use proceeds to buy more Bitcoin
Based on the latest news, you can exchange your notes for either cash or Class A shares of the company, or a mix of both options.
As a researcher, I would recommend using the time-weighted average price of MicroStrategy’s stock between 9:30 am and 4:00 pm EDT on the pricing date as the reference point for calculating the initial conversion.
Should a sale transpire, MicroStrategy would employ the post-sale earnings to acquire additional Bitcoins, expanding their existing stash of 214,400 BTC from the end of April 2024.
The company will also use these funds for other corporate purposes.
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2024-06-13 15:54