Michael Saylor's Strategy Plans $2 Billion Convertible Debt Offering
Michael Saylor's Strategy, formerly known as MicroStrategy Inc., plans to offer $2 billion of convertible debt in a private placement. The 2030 senior notes carry a 0% coupon and will be used to acquire more Bitcoin.
This move follows a recent period where Strategy did not raise funds through equity or debt sales for Bitcoin purchases. The notes offer a 40% to 50% conversion premium and a three-year put option.
Strategy's employee count was reduced by 20% in 2022 to 1,534. The company's stock has lost 30% of its value since its November high, but remains over 700% higher than three years ago.
As of February 17th, Strategy held 478,740 Bitcoin, worth over $45 billion. This represents over 2.5% of the total Bitcoin supply.
The convertible offering represents Strategy's first since raising over $560 million at a significant discount. The company aims to raise $42 billion by 2027 through stock sales and fixed-income offerings to fund Bitcoin purchases.
Hedge funds have driven demand for convertible debt, engaging in trades involving bond purchases and short-selling of shares to capitalize on the underlying stock's volatility.
Strategy anticipates offering initial buyers the option to purchase an additional $300 million of notes. A live webinar will be held at 10 a.m. New York time on Wednesday.