MicroStrategy’s $3B Offering Snapped Up in 3 Days, Clears Way for More Bitcoin Purchases

Key Takeaways

• MicroStrategy has successfully completed its $3 billion debt offering.
• The offering is part of the firm’s 21/21 plan.
• The increased Bitcoin holdings could lead to substantial gains for MicroStrategy.

MicroStrategy has completed its $3 billion offering  of 0% convertible senior notes.

This latest fundraising effort comes as MicroStrategy prepares to buy more Bitcoin (BTC).

MicroStrategy Completes $3B Offering

The debt issuance, which closes in December 2029, was offered at a 55% premium, with an implied strike price of around $672—This is the price at which holders can convert the notes into MicroStrategy’s Class A common stock.

The business intelligence firm started the offering earlier this week to boost its previously announced $1.75 billion offering.

Rising investor demand ultimately prompted MicroStrategy to raise the total to $2.6 billion.

MicroStrategy will use the funds to expand its Bitcoin holdings, continuing its aggressive strategy.

The notes offer an initial conversion rate of 1.4872 shares of MicroStrategy’s Class A stock per $1,000 principal amount, which works out to an initial conversion price of roughly $672.40 per share.

Despite the successful offering, MicroStrategy’s stock saw a sharp decline following the announcement. On Nov. 21, MSTR shares dropped more than 16% , closing at $397.28 in New York.

More Bitcoin

Michael Saylor’s company said the net proceeds from the sale of the notes were approximately $2.97 billion after deducting the initial purchasers’ discounts and commissions.

MicroStrategy intends to use the net proceeds from the sale of the notes to acquire additional Bitcoin and for general corporate purposes.

As of Nov. 22, 2024, MicroStrategy holds 331,200 Bitcoin  worth $32.86 billion. The average purchase price is $49,874 per Bitcoin, for a total cost of $16.51 billion.

The raising is just one part of MicroStrategy’s “21/21 plan,” which it unveiled earlier this month. Under the plan, the company intends to raise $42 billion to buy Bitcoins.