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MicroStrategy’s Third Debt Offering of 2024 to Raise $700M
MicroStrategy, the tech company known for its significant Bitcoin holdings, announced its third debt offering in 2024. The company aims to raise $700 million by issuing convertible senior notes, due in 2028.
Debt Payoff and Bitcoin Purchases
The funds raised will primarily be used to pay off $500 million in existing debt, with the rest allocated for purchasing more Bitcoin and general corporate needs. Refinancing through debt raises is a common strategy businesses use to secure better financial terms.
Convertible Notes Details
The newly issued notes will be unsecured and begin paying interest in March 2025. This offering is limited to institutional investors. It follows two previous debt offerings in March and June, which raised $700 million and $500 million, respectively.
Growing Bitcoin Holdings
MicroStrategy has been aggressively acquiring Bitcoin as part of its corporate strategy. As of September 2024, the company holds 244,800 BTC, valued at around $14 billion, making it one of the largest public Bitcoin holders globally.
Financial Impact
MicroStrategy’s substantial Bitcoin holdings have impacted its financial performance. The company posted a $102.6 million net loss in Q2 2024, largely due to a $180.1 million impairment from Bitcoin’s price volatility. Despite this, the company’s stock has surged nearly 295% over the past 12 months, reaching $134 in mid-September.
