MicroStrategy has announced a significant stock offering, raising approximately $563.4 million, aimed at purchasing Bitcoin and other corporate needs.
Details of the Stock Offering
On January 30, MicroStrategy sold 7.3 million shares of its 8% Series A perpetual strike preferred stock, known as STRK. The public offering price was set at $80 per share, nearly tripling the initial plan of issuing 2.5 million shares.
Funds Utilization Plans
The company expects to raise about $563.4 million from this offering. MicroStrategy plans to use these funds for general corporate purposes, particularly to buy more Bitcoin. As of January 27, the company owned 471,107 BTC, valued at over $46 billion.
Features of STRK Stock
Perpetual preferred stock is unique because it does not have a maturity date or a set redemption timeline. Instead, it pays fixed dividends indefinitely as long as the company is operational. The perpetual strike preferred stock has a liquidation preference of $100 per share and will accumulate dividends at a fixed rate of 8% per year. However, regular quarterly dividends will only be paid if declared by the company's board.
The new stock issuance enables MicroStrategy to strengthen its financial position and continue investing in cryptocurrencies like Bitcoin while meeting its debt obligations.
