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Michael Saylor's Strategy Continues Bitcoin Accumulation Amidst Stock Sales and Debt Management

Michael Saylor's Strategy Continues Bitcoin Accumulation Amidst Stock Sales and Debt Management

Strategy, led by Executive Chairman Michael Saylor, has once again expanded its Bitcoin holdings, acquiring an additional 2,932 BTC last week for $264.1 million. This latest purchase brings the company's total Bitcoin reserves to 712,647 BTC, valued at approximately $62 billion. The acquisitions continue to be funded primarily through the sale of common stock, with a smaller portion coming from preferred stock sales.

Key Takeaways

  • Strategy purchased $264.1 million worth of Bitcoin last week, adding 2,932 BTC to its reserves.
  • The company's total Bitcoin holdings now exceed 712,000 BTC, valued at over $62 billion.
  • Acquisitions are largely funded by common stock sales, with some preferred stock issuance.
  • The company is exploring strategies to manage its significant convertible debt.
  • International expansion efforts for preferred stock products have faced challenges.

Continued Bitcoin Acquisitions

Strategy's consistent accumulation of Bitcoin remains a core tenet of its corporate strategy. Last week's purchase, while a slowdown from previous weeks' larger acquisitions, underscores the company's ongoing commitment to the cryptocurrency. The average price paid for last week's acquisition was $90,061 per BTC. The company's total Bitcoin stack was acquired at an average price of $76,037 per coin.

Debt Management and Preferred Equity

In parallel with its Bitcoin purchases, Strategy is also navigating its substantial convertible debt. The company holds approximately $8.3 billion in outstanding convertible notes. A potential strategy for managing this debt overhang, as demonstrated by Strive, involves the use of perpetual preferred equity. Strive recently utilized a similar structure to retire convertible debt and restructure its balance sheet, offering a possible blueprint for Strategy to reduce future maturity risks.

International Preferred Stock Challenges

Strategy's attempt to expand its preferred stock offerings internationally, specifically in Europe with its 'Stream' (STRE) product, has encountered difficulties. Launched with a 10% annual dividend, STRE has struggled to gain traction due to accessibility issues, limited distribution on trading venues, and a lack of transparent market data. This contrasts with the company's domestic market where it offers multiple preferred share products.

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