MicroStrategy plans to issue perpetual preferred stocks in Q1 2025, raising up to $2 billion for the purpose of purchasing more Bitcoin. Possibly influenced by this news, the stock price of MicroStrategy rose by 13.22% in a single day, reaching $339.66.
Background:
MicroStrategy, the dominant holder of Bitcoin among US-listed companies, proposed the 21/21 Plan at the end of October last year. The plan aims to raise $21 billion through equity financing over the next three years and issue $21 billion in fixed-income products (including debt, convertible notes, and preferred stocks), totaling $42 billion, to be used for purchasing more Bitcoin.
MicroStrategy plans to issue preferred stocks to raise $2 billion
Just yesterday (3rd), MicroStrategy announced the latest progress of its 21/21 Plan. The company is currently planning to issue perpetual preferred stocks through one or more public offerings, raising up to $2 billion.
These perpetual preferred stocks will take priority over Class A common stocks and may possess the following features:
– Convertible to Class A common stocks
– Payment of cash dividends
– Support for stock redemption
MicroStrategy stated that the purpose of this issuance is to help the company continuously strengthen its balance sheet and purchase more Bitcoin. If the issuance proceeds as planned, it is expected to be implemented in the first quarter of 2025. However, MicroStrategy added that the initiation and completion of this issuance plan will depend on market and other conditions, and the company may decide not to proceed or cancel the issuance. Additionally, the issuance is expected to be registered through the submission of an S-3 form to the Securities and Exchange Commission (SEC), and the quantity of depositary shares represented by the perpetual preferred stocks, final terms, and issuance price have not yet been determined.
MicroStrategy’s Bitcoin holdings exceed 446,400 coins
MicroStrategy has repeatedly raised cash through the sale of stocks and bonds to purchase Bitcoin. On Monday (30th), the company announced another purchase of Bitcoin, using $209 million obtained from the sale of Class A common stocks to purchase 2,138 coins at an average price of approximately $97,837 per coin. As of now, MicroStrategy holds a total of 446,400 coins, valued at approximately $43.84 billion, with an unrealized profit of up to $15.94 billion.
MSTR stock price rises over 13%
Possibly influenced by MicroStrategy’s continued fundraising for Bitcoin purchases, the company’s stock price rebounded after several days of decline. According to Google Finance data, MicroStrategy’s stock price rose by 13.22% in a single day, reaching $339.66.