MicroStrategy used $458.2 million from the $1 billion convertible note offering to acquire Bitcoin.
MicroStrategy, a pro-Bitcoin and software firm, used part of the raised $1.01 billion from its 0.65% convertible note offering to buy Bitcoin. According to a Friday announcement, the firm stated it has acquired 7,420 BTC at an average price of $61,750.
The pro-Bitcoin firm’s recent acquisition increased its total stash to 252,220 BTC ($15.8 billion), acquired at an average price of $39,226. It bears mentioning that the firm acquired its Bitcoin with $9.9 billion, an almost $6 billion unrealized gain at the current market price.
The new purchase also means that MicroStrategy holds 1.27% of Bitcoin’s circulating supply and 1.20% of the asset’s total supply. MicroStrategy has further established itself as the second largest holder of Bitcoin, only toppled by BlackRock’s 357,550 BTC.
Notably, the September 19 acquisition was the firm’s second for the month. This increased its Bitcoin yield to 17.8% year-to-date. The Bitcoin yield was a key performance indicator that showed the relationship between MicroStrategy’s Bitcoin holding and assumed diluted shares outstanding.
MicroStrategy Raises $1.1B to Fuel Purchase
Recall that on August 16, MicroStrategy announced it intends to raise $700 million to acquire more Bitcoin. A few days later, the firm raised its offering to $875 million.
However, on Friday, it announced it has raised $1.01 billion, an excess of $135 million. This signals increased investor traction towards MicroStrategy’s Bitcoin strategy.
MicroStrategy noted that it would employ the raised funds to fully offset the $500 million outstanding convertible 6.125% senior secured notes due on September 26. The software firm will use any outstanding balance after the settlement to buy more Bitcoin.
Notably, MicroStrategy stated that its net realized funds were $997.4 million. It came to this figure after deducting the former purchaser’s discount and other offering expenses. The total funds realized were also more than the $875 million it announced it was looking to raise.
Convertible Note Details
Per the press release, the convertible notes were MicroStrategy’s unsecured obligations, offering a yearly return of 0.65%. The notes will mature in September 2028, but investors can start redeeming their claims on December 20, 2027.
MicroStrategy stated that it sold the notes to accredited investors according to Rule 144A under the Securities Act. At the debt’s maturity, holders can convert their notes at the rate of 5.4589 shares of MicroStrategy’s class A common shares per $1,000 of the debt note. Notably, investors can opt for a cash settlement or a combination of both.
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