Strategy, a prominent Bitcoin treasury company, revealed it will repurchase approximately half of its outstanding 2029 zero-percent convertible notes in a deal valued near $1.38 billion. The repurchase, executed through privately negotiated transactions with select noteholders, aims to retire a significant portion of this tranche’s debt due in 2029. The settlement is scheduled for the week following the announcement, though the final amount could fluctuate depending on market conditions.
The funding for this buyback will come from Strategy’s existing cash reserves, proceeds from its at-the-market securities offering, and potential sales of Bitcoin holdings. The move marks a crucial step toward the company’s broader plan to convert its debt into equity over the next three to six years, a strategy previously outlined by co-founder Michael Saylor. This approach is intended to alleviate debt burdens while gradually turning debt holders into equity shareholders, although it could lead to dilution of current stockholder value.
Currently, Strategy holds around $8.2 billion in total outstanding debt and has primarily financed Bitcoin acquisitions via its Stretch Perpetual Preferred Stock (STRC). Investor interest in STRC remains robust, as highlighted by a new record daily trading volume of $1.5 billion reached recently. The company continues to expand its Bitcoin portfolio, having acquired 535 Bitcoin for $43 million in its latest purchase, pushing total holdings to approximately 818,869 coins valued near $64 billion at market price.