MicroStrategy, led by CEO Michael Saylor, has increased the size of its planned stock sale to raise additional funds to buy Bitcoin. The company is now seeking to raise $700 million, up from the $500 million previously announced.
BREAKING: MicroStrategy Raises $700 Million to Buy Another #Bitcoin pic.twitter.com/B2I2uk98Ie
– Bitcoin Magazine (@BitcoinMagazine) June 14, 2024
MicroStrategy first announced plans on Thursday to raise $500 million by selling senior convertible notes to qualified institutional buyers. The proceeds will go primarily toward acquiring more Bitcoin for its corporate treasury, which already contains more than 214,400 BTC worth $15 billion.
The software analytics company then raised the offering to $700 million on Friday. The company said the offering is expected to close on June 17.
MicroStrategy has aggressively raised bitcoin since 2020 under Saylor’s guidance. It uses debt to fund its Bitcoin purchases, taking advantage of market volatility. The company expressed its confidence that Bitcoin will continue to appreciate in the long term.
By selling convertible senior notes, MicroStrategy gains flexibility. The notes pay interest and mature in 2032, but noteholders can convert to MicroStrategy stock before maturity.
This structure allows investors to benefit from a potentially higher Bitcoin price by using a stock conversion option. It also protects noteholders from adverse risks due to their senior unsecured status.
MicroStrategy said it may use funds not allocated to Bitcoin purchases for general business purposes. However, its goal is clearly to increase its Bitcoin trove while prices remain depressed.
The additional cash injection reflects MicroStrategy’s continued belief in Bitcoin as its primary financial asset. Saylor is doubling down on acquiring additional coins during the current market turmoil.
