MicroStrategy may decide not to move forward with the perpetual preferred stock offering if market conditions aren’t favorable this quarter.
MicroStrategy, the largest corporate holder of Bitcoin, is eyeing a $2 billion raise from a perpetual preferred stock offering to buy more Bitcoin in a move that would expand on the company’s “21/21” plan.
The perpetual preferred stock may be obtained through converting MicroStrategy’s class A common stock, paying a cash dividend, redeeming shares or a combination of these, the Bitcoin-stacking business intelligence firm explained in a Jan. 3 statement.
The offering is separate from MicroStrategy’s ongoing plan to raise $21 billion in equity and $21 billion in fixed-income instruments, a strategy it has largely implemented in recent months to fuel its Bitcoin buying spree through senior convertible notes and debt.
The perpetual preferred stock offering, which MicroStrategy intends to use to strengthen its balance sheet and buy more Bitcoin, is expected to occur sometime this quarter.
“However, the decision whether to proceed with and consummate the Offering is in MicroStrategy’s sole discretion and is subject to market and other conditions,” MicroStrategy explained.
“MicroStrategy may choose not to proceed with or consummate the Offering at all.”
The perpetual preferred stock offering is also “senior” to MicroStrategy’s class A common stock in the sense that holders have priority in the event of bankruptcy or liquidation.
MicroStrategy owns 446,400 Bitcoin valued at $43.9 billion, according to Bitcoin Treasuries.
It purchased 257,250 Bitcoin alone in 2024 — the company’s largest Bitcoin buying year yet.
The 446,400 Bitcoin have been purchased at a dollar-cost average of 62,500, meaning MicroStrategy is up 57.2% on its Bitcoin investment.
The firm’s Bitcoin investment strategy was orchestrated by executive chairman Michael Saylor, who has played a key role in paving the way for corporate Bitcoin adoption around the world.
Saylor’s Bitcoin strategy has also benefited MicroStrategy (MSTR) shares massively, which increased 13.2% on Jan. 3 to $339.6 — up 438% from this time last year.
MSTR has marginally fallen 0.19% since MicroStrategy’s perpetual preferred stock offering plan was announced in after-hours.
Source: cointelegraph.com
