Strategy, formerly known as MicroStrategy, has announced its intention to raise $2.1 billion through the sale of its Series A Perpetual Strife Preferred Stock (STRF). This move, detailed in a statement released on May 22, will be conducted through an at-the-market (ATM) program. This approach allows Strategy to sell shares gradually, taking advantage of favorable market conditions such as trading volume and price fluctuations.
The primary purpose of this fundraising initiative is to support the company’s ongoing Bitcoin acquisitions and other corporate endeavors. The funds raised from the sale of STRF will be instrumental in driving Strategy’s strategic objectives forward.
According to the prospectus, Strategy has enlisted the services of TD Securities, Barclays Capital, and The Benchmark Company to oversee the offering of STRF shares. These shares are currently listed on the Nasdaq Global Select Market and are priced at $100.65 per unit. It is important to note that this issuance will be in addition to the 8.5 million STRF shares that are already in circulation.
The preferred stock being offered is non-convertible and does not grant preemptive rights to investors. This means that holders of STRF shares will not have priority in future stock offerings or benefit from equity conversions. Swan, a financial firm focused on Bitcoin, has described this offering as a “Trojan horse” that will help attract conservative fixed-income capital to Bitcoin.
Strategy’s latest share sale is part of its broader 42/42 capital raising plan. With three ATM sales programs currently in operation, including one for MSTR shares that could potentially raise nearly $18.89 billion, the company is strategically positioned to continue its fundraising efforts. Additionally, Strategy has allocated funds to STRK and STRF, with $21.79 billion and $2.1 billion respectively.
As the largest corporate holder of Bitcoin, Strategy currently holds 576,230 BTC and shows no signs of slowing down its accumulation of the digital asset. Data from Saylor Tracker reveals that the firm’s Bitcoin holdings are now valued at approximately $64 billion, representing a significant increase of over 59% from its initial cost basis of $40.2 billion.
In conclusion, Strategy’s strategic approach to fundraising and its unwavering commitment to Bitcoin acquisitions position the company as a key player in the evolving landscape of digital assets. The innovative use of preferred stock offerings and the strategic allocation of funds demonstrate Strategy’s forward-thinking approach to capitalizing on market opportunities.