Source: Investing Published 01/24/2025, 16:07
MicroStrategy Inc (NASDAQ:MSTR), known for its large investments in Bitcoin and its remarkable 727% return over the past year, has issued a notice of full redemption of its 0.0% senior convertible bonds due 2025. According to InvestingPro data, analysts maintain a strong buy consensus with the stock potentially rallying to $650. The Company has notified the Trustee that it plans to redeem the outstanding Notes, totaling approximately $1.05 billion, on February 24, 2025.
Noteholders have the option to convert their investments into MicroStrategy Class A common stock until 5:00 p.m. New York City time on February 20, 2025. The company set the conversion rate at 7.0234 shares for every $1,000 of principal, equating to a conversion price of $142.38 per share. At the company’s discretion, it will settle conversions in shares and pay cash for any fractional shares.
To initiate the conversion, Noteholders must follow the procedures set forth in the escrow document governing the Notes, including surrendering their Notes through DTC’s electronic system. The company will redeem at a price equal to 100% of the principal plus any special interest accrued and unpaid up to, but not including, the redemption date. With total debt of approximately $4.27 billion and a current current ratio of 0.65, InvestingPro’s analysis indicates that the company is operating with a moderate level of debt relative to its market capitalization of $93 billion.
This announcement is not a notice of redemption and does not constitute an offer to buy or sell any notes. The specific terms and conditions of the redemption are detailed in the notice provided to noteholders by the trustee.
MicroStrategy, which describes itself as the world’s first and largest Bitcoin treasury company, has made headlines for its strategy of accumulating Bitcoin as a primary reserve asset for the treasury. The company offers AI-powered enterprise analytics software and actively develops Bitcoin applications, combining its analytics expertise with its focus on digital assets. InvestingPro subscribers can access 12 additional key insights into MSTR’s financial health, including a detailed analysis of volatile trading patterns and comprehensive valuation metrics through the Pro Research Report, available exclusively on the platform.
The information contained in this article is based on a press release issued by MicroStrategy Inc.
In other recent news, MicroStrategy Inc. announced a series of significant corporate developments. After a special shareholders meeting, the company expanded its stock authorization and amended its second restated certificate of incorporation to significantly increase the number of Class A common shares and preferred shares authorized. Additionally, the company approved a 2024 Plan Amendment to the original 2023 Stock Incentive Plan, granting new non-employee board members stock awards valued at $2 million.
In line with its ongoing strategy, MicroStrategy has also made significant moves into the cryptocurrency market, adding nearly $1.1 billion worth of Bitcoin to its portfolio. The company funded this latest acquisition with proceeds from the sale of over 3 million shares, increasing its total Bitcoin holdings to approximately 461,000.
MicroStrategy’s commitment to the digital currency was underscored by its chairman, Michael Saylor, calling for investments in Bitcoin instead of bonds. This support follows the company’s consistent weekly Bitcoin purchases, recently marking its 10th consecutive week of acquisitions.
In addition to crypto investments, MicroStrategy also launched the MicroStrategy Sovereign European Cloud in partnership with STACKIT, aimed at serving highly regulated businesses in Europe. The company’s AI-powered solutions earned recognition at the 2025 National Retail Federation Conference, where it won the Partner of the Year Award and the AI Innovation and Application VIP Challenge Award.
These latest developments reflect MicroStrategy’s strategic focus on investing in Bitcoin and its drive to leverage its stock to increase its crypto holdings.