TLDR
- Strategy has filed for an initial public offering of euro-denominated perpetual stock to fund Bitcoin purchases.
- The company plans to offer 3.5 million shares under the ticker symbol STRE, with a stated value of €100 per share.
- The STRE stock provides a 10% yearly cumulative dividend paid quarterly starting on December 31.
- The offering is restricted to qualified investors in the European Union and the United Kingdom only.
- Strategy currently holds 641,205 BTC, acquired for a total of $47.49 billion.
Strategy has filed for an initial public offering of euro-denominated perpetual stock. The company plans to use the proceeds from the offering to purchase additional Bitcoin (BTC). The move continues the firm’s aggressive strategy of accumulating Bitcoin.
Strategy IPO Details and Structure
The crypto treasury company will offer 3.5 million shares under the ticker STRE. Each share carries a stated value of 100 euros or $115. The offering targets qualified investors in the European Union and the United Kingdom.
The STRE stock provides a 10% yearly cumulative dividend on its stated amount. Dividends will be paid quarterly starting on December 31. However, retail investors in the EU and UK cannot access these shares.
Barclays, Morgan Stanley, Moelis, and TD Securities serve as book-running managers. The Strategy IPO represents another capital-raising effort for the company. Net proceeds will be used to fund Bitcoin purchases and general business operations.
Company’s Bitcoin Accumulation Strategy
Strategy currently holds 641,205 BTC, acquired for a total of $47.49 billion. The company purchased 397 Bitcoin in early November to begin the month. This makes Strategy the largest Bitcoin holder among publicly traded companies.
Founder Michael Saylor implemented this business model in mid-2020. The approach involves issuing shares and raising capital specifically for the purpose of purchasing Bitcoin. Strategy has successfully executed this model for over four years.
The company’s strategy has inspired numerous competitors in the crypto treasury sector. These companies have raised billions to stockpile Bitcoin and other cryptocurrencies, such as Ether. Many firms now follow Strategy’s blueprint for accumulating digital assets.
Future Plans and Market Position
Saylor told investors the company will maintain its current approach. “The focus is to sell digital credit, improve the balance sheet, buy Bitcoin,” he said. He added that the company communicates this plan to credit and equity investors.
The strategy does not currently plan to pursue mergers and acquisitions. Saylor stated that this position should be taken even if deals appear potentially accretive. The company remains focused on its core mission of accumulating Bitcoin.
Some analysts worry about the sustainability of this business model. Concerns center on increased competition from new market entrants. The IPO filing shows the company continues to expand its capital-raising options.
The euro-denominated offering provides Strategy with new funding sources. This diversifies the company’s approach to capital markets. The perpetual stock structure offers investors ongoing dividend payments tied to Bitcoin investments.
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