PANews reported on November 20 that MicroStrategy announced the pricing of its $2.6 billion total principal of zero-interest convertible senior notes due in 2029, an increase from the previously announced $1.75 billion total principal note issuance. The issuance is expected to be completed on November 21, 2024, subject to customary closing conditions.
The initial conversion rate for the Notes is 1.4872 shares of MicroStrategy Class A common stock per $1,000 principal amount of the Notes, representing an initial conversion price of approximately $672.40 per share. The initial conversion price for the Notes represents a premium of approximately 55% to the U.S. composite volume weighted average price of MicroStrategy Class A common stock between 1:30 p.m. and 4:00 p.m. EST on November 19, 2024, of $433.7997. The conversion rate will be adjusted upon the occurrence of certain events.
MicroStrategy estimates that the net proceeds from the sale of the Notes, after deducting discounts and commissions to the initial purchasers and estimated offering expenses payable by MicroStrategy, will be approximately $2.58 billion (or approximately $2.97 billion if the initial purchasers exercise in full their option to purchase additional Notes). MicroStrategy intends to use the net proceeds from the offering to purchase additional bitcoin and for general corporate purposes.
