MicroStrategy repurchases $1.5 billion in debt at a discount
MicroStrategy, led by Michael Saylor and the world's largest corporate Bitcoin holder, announced the repurchase of $1.5 billion of its 0% convertible senior notes due in 2029. The company purchased this debt at an 8% discount to its par value, totaling $1.38 billion, significantly reducing its future liabilities. This was reported by Cointelegraph.com reports .
As a result of this transaction, MicroStrategy's debt from convertible notes due in 2029 decreased from $8.2 billion to $6.7 billion. According to the company, cash reserves were used to fund the repurchase. The company also disclosed that it holds $15.5 billion in preferred shares and $871 million in USD reserves.
Repurchasing debt at a discount strengthens the company's balance sheet and is generally viewed positively by shareholders. Bitwise analyst André Dragosch praised the move, noting that it eliminates uncertainties regarding payment obligations in mid-2028. Since the conversion price of these notes was around $672, there was a high probability that investors would demand cash repayment.
Despite the reduction in debt, MicroStrategy shares fell 3% in Tuesday's trading, closing at $159. According to Yahoo Finance, the company's stock has declined 10% over the last month and 59% year-to-date. Bitcoin's price has also recorded a decline of 1.2% over the last month and 29% year-to-date.
