U.Today – MicroStrategy, the business intelligence firm led by Michael Saylor, has announced the pricing of its latest debt offering. According to a new press release, the company plans to raise $700 million by issuing convertible senior notes due 2032, for the purpose of additional purchases and to cover general corporate expenses.
This move follows an earlier announcement aimed at raising $500 million, indicating what may be strong investor demand that has allowed MicroStrategy to increase the offering.
The convertible notes will bear an interest rate of 2.25% per annum, payable semiannually on June 15 and December 15, beginning December 15, 2024. They mature on June 15, 2032, unless repurchased, redeemed or converted before.
MicroStrategy retains the option to redeem the notes for cash after June 20, 2029, under specified conditions, provided the Company's Class A common stock meets certain pricing thresholds.
Investors will have the option to convert the notes into cash, MicroStrategy Class A common stock, or a combination of both. The initial conversion rate is set at approximately 0.4894 MSTR shares per $1,000 principal amount of notes, which translates to an initial conversion price of approximately $2,043.32 per share. This price represents a 35% premium over the company's recent share price.
MicroStrategy estimates that the net proceeds from the offering will be around $687.8 million, or up to $786 million if the initial buyers exercise their option to purchase additional notes. The sale will be made privately to qualified institutional investors only.
This article was originally published on U.Today.
