Mar 23, 2021 - Economy

Telegram raises $150 million in convertible bonds

Illustration of a crumpled dollar bill with binary code over it

Illustration: Sarah Grillo/Axios

Telegram, a popular chat app with more than 500 million monthly active users, has raised $150 million in new five-year pre-IPO convertible bonds from sovereign fund Mubadala and Abu Dhabi Catalyst Partners, the firms said on Tuesday.

Why it matters: The company reportedly owes creditors $700 million by the end of April as a result of having to pay back money it had raised from selling digital tokens starting in late 2017, according to the Wall Street Journal.

  • Telegram is said to be planning to issue $1 billion to $1.5 billion in total bonds, per the WSJ.

Flashback: Telegram's initial coin offering (ICO) was the hottest such deal at the time, with top Silicon Valley investors vying for a piece of it. It raised $1.7 billion from two rounds.

  • However, in 2019, the U.S. Securities and Exchange Commission sued to halt Telegram's distribution of its tokens to American investors for failing to register as a sale of securities.
  • In June 2020, the company settled with the commission for $18.5 million in fines, and offered to refund investors in its ICO.
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