$BTC

Strategy moves aggressively! Announces Series A funding of $1 billion, preparing to use the money to buy more Bitcoin

Strategy, the largest privately held Bitcoin holding company led by Michael Saylor, has announced it is raising $979.7 million in Series A Perpetual Preferred Stock to buy more Bitcoin and boost the company’s liquidity.

The plan is to issue a total of 11,764,700 shares at a price of $85 per share, and pay a non-cumulative dividend of 10% of par value to professional and institutional investors, marking a shift from the company's traditional strategy of raising capital by selling common stock or convertible debt.

With Bitcoin’s current market price around $103,800, Strategy could potentially buy up to 9,633 BTC, which would be more than the company’s last purchase on June 2, when it bought 705 BTC for $75.1 million.

The VanEck report also points out that Strategy (MSTR) shares are trading at a 112% premium to the intrinsic value of the company’s Bitcoin holdings, coupled with its core software business, due to expectations of increased Bitcoin accumulation, regulatory advantages, and investor speculation.

Markus Thielen of 10x Research commented that every time MicroStrategy issued new shares, the value of the shares was much higher than the intrinsic value of the Bitcoin it held. The company was able to capture the difference and present it as a return on Bitcoin.

However, Strategy's premium is still lower than Japanese investment firm Metaplanet, whose stock price reflected a premium of as much as $596,154 on May 27. 

REF: siamblockchain