Strategy Seeks Early Repayment of $1.5 Billion in Convertible Notes Due 2029

Strategy, the largest corporate holder of Bitcoin, plans to repay about $1.5 billion of convertible notes due in 2029 ahead of schedule.

Cointelegraph reported on May 16 that Strategy said in a filing with the US Securities and Exchange Commission it had negotiated privately with some holders of its 0% convertible notes and agreed to repurchase about $1.38 billion of the debt.

The deal is scheduled to close next Tuesday, though the final repayment amount could change depending on market conditions.

Strategy said it plans to fund the repayment with cash on hand, proceeds from its at-the-market equity offering program, or proceeds from Bitcoin sales.

The move is being viewed as part of the company's broader debt restructuring strategy.

Earlier in May, Chairman Michael Saylor said the company could sell some Bitcoin to fund dividend payments. In February, he also outlined a plan to gradually shift the company's debt structure toward equity over the coming years.

Strategy is pursuing a plan to gradually convert its convertible notes into equity over the next three to six years. That could help reduce its debt burden, but it may also dilute existing shareholders.

Strategy's total debt is about $8.2 billion.

The company has recently been raising funds for Bitcoin purchases mainly through its floating-rate perpetual preferred stock, STRC. STRC recently posted a record $1.5 billion in daily trading volume.

Strategy also bought 535 Bitcoin for $43 million on May 11. The company now holds 818,869 Bitcoin, worth about $64 billion at current market prices.