Telegram Collects $1.7B in Funding Through Convertible Bonds, Bloomberg Says

Telegram Secures $1.7 Billion Through Convertible Bond Offering to Refinance Debt and Fund Growth

Telegram has raised $1.7 billion by issuing five-year convertible bonds, with plans to use the proceeds both to refinance maturing debt and to finance business expansion, Bloomberg reports.

The company, which now boasts over 1 billion users, will allocate $955 million toward buying back bonds scheduled to mature in 2026. The remaining $745 million is earmarked for operational growth and strategic investments.

Investors in these convertible bonds have the option to convert their holdings into equity if Telegram conducts an IPO before the bonds mature, with redemption terms set at 80% of the IPO price.

The tender offer concluded on May 28, with settlement expected by June 5. The funding round drew strong interest from returning investors like BlackRock and Mubadala, as well as new participants such as hedge fund Citadel, according to CoinDesk.

These new bonds carry a 9% coupon, compared to 7% on Telegram’s previous $2.35 billion bond issue in 2021.

Telegram surpassed $1 billion in revenue last year and holds over $500 million in cash reserves excluding cryptocurrency assets, Bloomberg adds.