S&P rates MicroStrategy notes B-

S&P said it assigned B- issue-level and 2 recovery ratings to MicroStrategy Inc.’s new $500 million senior secured notes. S&P assigned MicroStrategy a CCC+ issuer rating.

Proceeds will be used to buy Bitcoin.

“Following this new $500 million senior secured note issuance, MicroStrategy's pro forma S&P Global Ratings-adjusted leverage will rise above 20x. We note that while the company's starting leverage will be extremely high, its EBITDA interest coverage is more favorable given the low interest rates on its convertible senior notes, which leads us to believe it could sustain its capital structure over the next 12 months,” the agency said in a press release.

The outlook is stable.

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