In a filing that was released on Friday morning, Strategy (MSTR), the biggest bitcoin holding company in the world, said that it will repurchase about $1.5 billion worth of its outstanding 0% Convertible Senior Notes due 2029 in privately negotiated transactions with specific noteholders.
Buying the notes at a discount to par value, the corporation plans to pay around $1.38 billion in cash. The $3 billion notional amount and 0% coupon 2029 convertible notes were first issued in November 2024. The conversion price per share is $672.40, and the debt matures on Dec. 2, 2029. At its current level of $183, the share price is much lower.
A portion of the ultimate buyback price will be determined by the volume-weighted average price of Strategy’s Class A common stock within a specified measurement period, which is still up for grabs.
Strategy has said that it intends to finance the acquisition using its current cash on hand, as well as with earnings from the selling of shares and, maybe, bitcoin. The repurchased notes will be canceled after settlement, which is anticipated to occur around May 19, leaving around $1.5 billion of the 2029 notes outstanding.
Perpetual Preferred Stocks Gaining Popularity
Trading in STRC, Strategy’s perpetual preferred stock, hit a fresh record high of $1.5 billion on Thursday. Strategy’s primary vehicle for funding its 2026 Bitcoin buys might be STRC.
Stretch enables investors to earn a dividend of 11.5% without diluting ordinary shares. If Thursday’s results hold, the STRC.live tracker estimates that the company may generate $735.4 million—enough to purchase 9,066 Bitcoin (BTC). Strategy may or may not use the funds raised by Stretch to buy Bitcoin.
As a means for Bitcoin treasuries to acquire more Bitcoin in the present bear market, perpetual preferred stocks have gained popularity as an alternative to senior convertible notes and at-the-market equity issuance.