Strategy prices $979.7 million preferred stock offering

TYSONS CORNER, Va. - Strategy™ (NASDAQ:MSTR), a technology company with a market capitalization of $103 billion and known for its significant Bitcoin holdings, has priced its initial public offering (IPO) of Series A Perpetual Stride Preferred Stock, set to raise approximately $979.7 million in net proceeds. The company’s stock has shown remarkable performance, delivering a 122% return over the past year despite significant price volatility, according to InvestingPro data. The offering, which was announced on Thursday, involves 11,764,700 shares at $85.00 each, with settlement expected on June 10, 2025, pending customary closing conditions.

The proceeds from the offering are earmarked for general corporate purposes, including Bitcoin acquisition and working capital. This move comes as the company operates with a moderate debt level and faces challenges with short-term obligations exceeding liquid assets, as revealed by InvestingPro’s financial health analysis. The non-cumulative dividends attached to the STRD Stock are pegged at an annual rate of 10.00%, distributed quarterly starting September 30, 2025, subject to declaration by the board of directors.

Strategy retains the right to redeem all shares of the STRD Stock under specific conditions, including a decrease in the outstanding shares below 25% of the total issued or in the event of certain tax circumstances. The redemption price will be equal to the liquidation preference plus any declared and unpaid dividends.

In the event of a fundamental change, as defined by the certificate of designations, shareholders can require Strategy to repurchase their STRD Stock at the stated amount plus any declared and unpaid dividends.

The liquidation preference for the STRD Stock is initially set at $100 per share and is subject to adjustment based on certain conditions outlined in the prospectus supplement.

Joint book-running managers for the offering include Barclays, Morgan Stanley, Moelis & Company, and TD Securities, with several other firms acting as co-managers.

This offering follows Strategy’s strategy of leveraging its Bitcoin holdings and advocating for the cryptocurrency’s use as a digital reserve asset. The company’s combination of Bitcoin investment and enterprise analytics software positions it uniquely in the market, though current analysis suggests the stock is trading above its Fair Value. For deeper insights into Strategy’s valuation and 11 additional key ProTips, investors can access the comprehensive Pro Research Report available on InvestingPro.

The offering is made through a shelf registration statement filed with the Securities and Exchange Commission (SEC), available on the SEC’s website.

This press release, based on a statement from Strategy, does not constitute an offer to sell or a solicitation of an offer to buy any securities. The sale of these securities will not proceed in any jurisdiction where it would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

In other recent news, Strategy announced its plan to offer 2.5 million shares of its 10.00% Series A Perpetual Stride Preferred Stock. This offering aims to raise funds for general corporate purposes, including Bitcoin acquisition and bolstering working capital. Additionally, Strategy unveiled a sales agreement to issue up to $2.1 billion of its 10.00% Series A Perpetual Strife Preferred Stock, with proceeds intended for similar corporate uses. Meanwhile, TD Cowen maintained a Buy rating on Strategy, highlighting the company’s recent acquisition of 4,020 bitcoins for $427 million. This purchase was primarily funded through an at-the-market offering of common stock. The introduction of a new STRF preferred stock ATM valued at $2.1 billion is expected to benefit common shareholders. Monness, Crespi, Hardt analysts reaffirmed their Sell rating on Strategy, expressing concerns about the company’s financial strategies and market conditions. The firm noted limited interest in Strategy’s STRK/STRF issuances, which could affect the company’s market position. Benchmark analyst Mark Palmer offered a positive outlook, emphasizing Strategy’s impressive Bitcoin yield and maintaining a Buy rating with a price target of $650.

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