MicroStrategy Ready to Scrape $700 Million Worth of Bitcoin

MicroStrategy, an analytics company and business intelligence software owned by Michael Saylor. (Photo; Doc. Westerers)

JAKARTA - The company engaged in business intelligence software, MicroStrategy, this time announced its plans to offer company conversion bonds worth $700 million which will mature in 2028, according to market conditions.

This announcement was made by MicroStrategy through a press release on September 16, 2024. Michael Saylor's company also plans to provide additional 105 million US dollars (Rp1.68 trillion) for early buyers in the 13-day period following bond issuance.

MicroStrategy plans to use the funds raised from this bond offering to redeem a guaranteed previous bond of US$500 million (Rp8 trillion) due in 2028, and has the potential to buy more Bitcoins. These unsecured bonds will mature on September 15, 2028, with interest paid semi-yearly starting March 2025.

MicroStrategy has the option to redeem bonds in cash from December 2027, with certain conditions limiting the ransom of bonds still in circulation. Investors also have the option to convert these bonds into cash, grade A regular shares, or a combination of both.

In addition, the company has issued a redeeming notice for the previous bonds, which are scheduled to be redeemed on September 26, 2024, depending on the settlement of the sale. This relief will free 69,080 Bitcoins that are currently used as bond guarantees, reported by DL News.

These bonds will be offered in private sales and are not registered under US securities law, available only to institutional buyers who meet the requirements according to Rule 144A.

MicroStrategy and Bitcoin

MicroStrategy's latest plan to issue a $700 million conversion bond is part of a strategy that has been implemented over the past few years to fund Bitcoin accumulation aggressively. Since 2020, the company has raised billions of dollars through similar offerings, using a combination of debt and equity to support their Bitcoin purchases.

In 2024, MicroStrategy successfully completed a bond offering of US$603.75 million (Rp9.66 trillion) with an interest rate of 0.85%, due in 2031. The funds were used to buy more Bitcoins and strengthen the company's strategy and integrate these crypto assets into their financial structure.

This effort resembles a similar approach carried out earlier in the year, when MicroStrategy raised $ 800 million (Rp. 12.8 trillion) through a conversion bond offering with an interest rate of 0.625%, due in 2032.

Sebagai informasi tambahan, saat ini MicroStrategy merupakan pemegang korporasi terbesar Bitcoin, dengan lebih dari 244.800 BTC yang bernilai sekitar 14,2 miliar dolar AS (Rp227,2 triliun).