BlackRock, Citadel join Telegram bond sale worth $1.5B with 9% yield and IPO perks

Telegram, the encrypted messaging platform with 900 million users, is set to raise $1.5 billion in a high-stakes Telegram bond sale, attracting institutional titans like BlackRock, Citadel, and Abu Dhabi’s Mubadala. The bonds offer a 9% annual yield and a 20% discount on shares in a potential IPO, according to The Wall Street Journal.

The Telegram bond sale marks a pivotal moment for the tech firm, which plans to refinance its 2021 debt and fuel expansion ahead of a rumored public listing.

“This is a strategic play to strengthen Telegram’s balance sheet while rewarding early investors,” said a source close to the deal.

Why Wall Street is betting on the Telegram bond sale

The Telegram bond sale has become a magnet for institutional investors, blending high yields with equity upside. BlackRock, the world’s largest asset manager and a major Bitcoin holder, is doubling down on Telegram after backing its 2021 bonds. Hedge fund Citadel, meanwhile, is entering as a new investor—a signal of confidence in the platform’s monetization push.

“The 9% coupon is aggressive but justified given Telegram’s growth trajectory,” said Larry Fink, CEO of BlackRock, in a recent earnings call. “We see this as a bridge to their IPO.”

The Telegram bond sale also includes a rare perk: bondholders can convert debt into equity at a 20% discount if the company goes public. “It’s a win-win—investors get yield now and IPO upside later,” noted Ken Griffin, Citadel’s founder, during a Bloomberg interview.

From debt refinancing to IPO dreams

According to reports, Telegram will use proceeds from the Telegram bond sale to buy back $700 million in outstanding 2021 bonds, easing its path to an IPO. The company has teased a public listing for years, and this bond structure mirrors its 2021 deal, which offered similar IPO incentives.

“The Telegram bond sale is a clever way to align investor and company interests,” said Mirabaud Securities analyst Neil Campling. “They’re avoiding dilution now while keeping IPO options open.”

Abu Dhabi’s Mubadala, an existing backer, reaffirmed its commitment. “Telegram’s user growth and ad revenue potential make this bond compelling,” said Khaldoon Al Mubarak, the fund’s CEO, in a statement.

Risks and rewards of Telegram’s bold move

While the Telegram bond sale has drawn blue-chip names, skeptics question Telegram’s profitability. The platform relies on ads and premium subscriptions but faces regulatory scrutiny over its crypto ventures. Still, the 9% yield—far above U.S. Treasury rates—has turned heads.

“High yield doesn’t erase risk, but Telegram’s ecosystem is unique,” warned JPMorgan strategist Marko Kolanovic. “Its bond success hinges on delivering an IPO.”

With the Telegram bond sale closing soon, all eyes are on whether the company can convert its viral reach into sustainable revenue, and finally go public.