Please ensure Javascript is enabled for purposes of website accessibility

MicroStrategy Aims to Raise $600 Million in Order to Buy More Bitcoin

By Keith Noonan - Updated Feb 16, 2021 at 10:26AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The business analytics company is clearly still very bullish on Bitcoin.

MicroStrategy (MSTR -4.56%) published a press release on Tuesday morning announcing that it plans to raise $600 million through the private sale of convertible senior notes. The proceeds of the sale would go toward buying more Bitcoin (BTC -2.99%).

The option to purchase the notes will be available only to qualified institutional buyers, and MicroStrategy also plans to offer initial purchasers an option to buy more notes in an additional offering in the amount of $90 million. That would bring the fundraising target raised through the potential sale to $690 million, with all net proceeds intended to go toward buying more Bitcoin tokens. 

A Bitcoin logo.

Image source: Getty Images.

The notes would pay an undisclosed amount of interest on a semiannual basis starting on Aug. 15 and mature in mid-February 2027. But MicroStrategy's current plan would also give the company the option to repurchase or redeem the notes in February 2024 providing certain conditions (currently undisclosed) are met. MicroStrategy would have the option to pay noteholders either in cash, class A shares of its common stock, or a combination of the two. 

As of its last official disclosure, MicroStrategy reported owning 71,079 Bitcoin tokens. That holding would be worth roughly $3.53 billion based on Bitcoin's current price of roughly $49,660 per token. Bitcoin has surged to new highs early in 2021 and has been buoyed by increased institutional support and integration on fintech platforms and support from some high-profile companies, including Tesla

MicroStrategy's share price has surged roughly 595% over the last year, with the incredible gains being largely driven by huge pricing surges for Bitcoin tokens. Despite Bitcoin's incredible rally, MicroStrategy's plan to make more big buys shows the company is still very bullish on the cryptocurrency's future. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

MicroStrategy Incorporated Stock Quote
MicroStrategy Incorporated
$195.24 (-4.56%) $-9.33
Tesla, Inc. Stock Quote
Tesla, Inc.
$739.30 (-3.94%) $-30.29
Bitcoin Stock Quote
$29,450.26 (-2.99%) $-907.31

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/16/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.