By Abigail W. Adams
Portland, Me., Dec. 9 – MicroStrategy Inc. priced an upsized $550 million of five-year convertible notes after the market close on Tuesday at par at the rich end of talk with a coupon of 0.75% and an initial conversion premium of 37.5%, according to a company news release.
Price talk was for a coupon of 0.75% to 1.25% and an initial conversion premium of 32.5% to 37.5%, according to a market source.
Jefferies LLC was bookrunner for the Rule 144A offering, which carries an upsized greenshoe of $100 million.
The initial size of the offering was $400 million with a greenshoe of $60 million.
The notes are contingently convertible until June 15, 2025.
The convertibles are non-callable until Dec. 20, 2023 and are then subject to a 130% hurdle.
They are putable upon a fundamental change.
The notes will be settled in cash, shares or a combination of both at the company’s option.
Net proceeds are expected to be $537.2 million or will be $634.9 million if the greenshoe is exercised in full.
Proceeds will be used to invest in Bitcoin in accordance with its Treasury Reserve Policy and for general corporate purposes.
MicroStrategy is a Tysons Corner, Va.-based business intelligence and analytics company.
| Issuer: | MicroStrategy Inc.
|
| Securities: | Convertible senior notes
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| Amount: | $550 million
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| Greenshoe: | $100 million
|
| Maturity: | Dec. 15, 2025
|
| Bookrunner: | Jefferies LLC
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| Coupon: | 0.75%
|
| Price: | Par
|
| Yield: | 0.75%
|
| Conversion premium: | 37.5%
|
| Conversion price: | $397.99
|
| Conversion rate: | 2.5126
|
| Call options: | Non-callable until Dec. 20, 2023 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
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| Pricing date: | Dec. 8
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| Settlement date: | Dec. 11
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| Distribution: | Rule 144A
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| Talk: | Coupon of 0.75% to 1.25% and initial conversion premium of 32.5% to 37.5%
|
| Stock symbol: | Nasdaq: MSTR
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| Stock price: | $289.45 at market close Dec. 8
|
| Market capitalization: | $2.68 billion
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