In the latest announcement, MicroStrategy Incorporated has revealed plans to raise up to $2 billion through public underwritten offerings of perpetual preferred stock in the first quarter of 2025, as a part of its ‘21/21 Plan’. The capital plan aims to generate $21 billion in equity and fixed-income instruments over the next three years to strengthen the company’s balance sheet and expand its Bitcoin holdings.
The perpetual preferred stock offering, expected to take place in the first quarter of 2025, will be registered with the U.S. Securities and Exchange Commission (SEC) via Form S-3. The offering will rank senior to MicroStrategy’s Class A common stock and may feature convertibility to common stock, cash dividend payments, and redemption provisions.
MicroStrategy: Endless Love for Bitcoin
Amid the bullish momentum, MicroStrategy has grown its Bitcoin pile with continuous acquisitions at certain intervals.
MicroStrategy’s aggressive Bitcoin investment is facing a major slump. The firm boosted its Bitcoin holdings to 446,400 BTC with a $200 million purchase. Despite these purchases, its stock continues to face downward pressure.
Interestingly, since its November peak, MicroStrategy has made five Bitcoin purchases, each one smaller than the last. The firm remains the largest holder of Bitcoin and initially adopted the cryptocurrency in 2020 to strengthen its balance sheet.
However, Wall Street now views MicroStrategy as a highly leveraged Bitcoin bet. The company has issued $7.3 billion in convertible notes to fund its Bitcoin buys, which has raised concerns.
Also Read: MicroStrategy reports Q1 2024 financial results with ownership of 214,400 BTC
