MicroStrategy, led by CEO Michael Saylor, has increased the size of its planned stock sale to raise additional funds to purchase bitcoin. The company is now looking raise 700 million dollarscompared to the $500 million previously announced.
<blockquote class="twitter-tweet”>
BREAKING NEWS: MicroStrategy increased its fundraising to $700 million to buy more twitter.com/hashtag/bitcoin?src=hash&ref_src=twsrc%5Etfw”>#bitcoin pic.twitter.com/B2I2uk98Ie
– bitcoin Magazine (@BitcoinMagazine) twitter.com/BitcoinMagazine/status/1801587287651692864?ref_src=twsrc%5Etfw”>June 14, 2024
MicroStrategy first announced plans on Thursday to raise $500 million by selling convertible senior notes to qualified institutional buyers. The profits would primarily go toward acquiring more bitcoin for its corporate treasury, which already contains more than 214,400 btc worth $15 billion.
The software analytics firm later raised the offer to $700 million on Friday. The company said the offering is expected to close on June 17.
MicroStrategy has aggressively accumulated bitcoins since 2020 under Saylor's leadership. It uses debt to finance its bitcoin purchases, taking advantage of market volatility. The company cited its confidence that bitcoin will continue to appreciate in the long term.
By selling convertible senior notes, MicroStrategy gains flexibility. The bonds pay interest and mature in 2032, but bondholders can convert them into MicroStrategy shares before maturity.
This structure allows investors to benefit from the potential rise in the price of bitcoin through the stock conversion option. It also protects noteholders from downside risk due to their senior unsecured status.
MicroStrategy said it may use revenue not allocated to bitcoin purchases for general corporate purposes. However, their intention is clearly to expand their bitcoin hoard while prices remain depressed.
The injection of additional capital indicates MicroStrategy's continued conviction in bitcoin as its primary treasury reserve asset. Saylor is doubling down by acquiring more coins amid the current market turbulence.
<script async src="https://platform.twitter.com/widgets.js” charset=”utf-8″>
