MicroStrategy (MSTR) Completes $3 Billion Offering of 0% Convertible Senior Notes Due in December 2029 to Buy More Bitcoin

The business intelligence firm announced the completion as its shares retraced over 25% on Nov. 21, Google Finance data shows.

Business intelligence firm MicroStrategy (MSTR) has completed a $3 billion offering of 0% convertible senior notes due in December 2029, with plans to use a portion or all of the proceeds to buy more Bitcoin.

The convertibles come at a 55% premium with an implied strike price of around $672 — a predetermined price at which an option holder can buy or sell MicroStrategy’s class A common stock.

The 0% senior convertible note means it will not pay regular interest to bondholders. These convertibles are sold at a discount and will instead mature to face value if they are not converted prior to the maturity date.

They’re also “senior” to common stock in the sense that holders have priority in the event of bankruptcy or liquidation.

The offering follows MicroStrategy’s Nov. 18 announcement to raise $1.75 billion at 0% interest, which was then increased to $2.6 billion on Nov. 20.

The offerings are part of MicroStrategy’s bold plans to raise $42 billion in the next three years to stack more Bitcoin under its “21/21” plan — consisting of $21 billion in equity and $21 billion in fixed-income securities.

MicroStrategy currently holds 331,200 Bitcoin BTC $98,462 worth over $32.7 billion — the most of any public company, according to Saylor Tracker.

MicroStrategy’s latest $3 billion offering brings the total raised in recent weeks to a record $7.1 billion.

The offering is also the largest ever 0% coupon convertible bond offering in the U.S. high-yield market, according to Sells.

MicroStrategy shares fell over 25% from its highest point of $536.7 to $397.28 when the closing bell rang on Nov. 21.

MSTR’s change in share price on Nov. 21, including a 5.3% recovery in after-hours trading. Source: Google Finance

The fall came as Cirtron Research revealed it hedged a short position on MSTR, suggesting MSTR shares have become “overheated and that its volume has “completely detached from BTC fundamentals.”

MSTR is still one of the best performers in the U.S. markets in 2024, up 480% year-to-date.

It was the second most-traded stock in the U.S. on Nov. 20 as more investors weighed up the bull case and risks of Bitcoin exposure through MSTR.

MicroStrategy’s firm contributed to a record-setting $70 billion trading volume on Nov. 21 from the “Bitcoin Industrial Complex” — consisting of U.S. spot Bitcoin exchange-traded funds and Bitcoin-related stocks like MSTR and Coinbase (COIN).

Bitcoin is currently priced at $98,423 — about 1.5% off cracking the $100,000 milestone, CoinGecko data shows.

Magazine: Bitcoin dominance will fall in 2025: Benjamin Cowen, X Hall of Flame

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