Strategy sold common stock during Nov. 2-8 and spent most of the proceeds on STRC preferred-stock repurchases rather than Bitcoin. The company recorded no sales through its four preferred-stock programs that week.
Strategy raised $284 million in net proceeds by selling 2,051,348 MSTR common shares during Nov. 2-8. The Bitcoin treasury company directed $188 million to STRC repurchases, $82 million to Bitcoin and $14 million to its USD Cash balance.
Buybacks took the larger share
STRC repurchases absorbed 66.3% of MSTR net proceeds, while Bitcoin purchases used 28.9%. Strategy repurchased 1,887,464 STRC shares for $188 million.
The company acquired 1,036 BTC for $82 million over the same stretch, at an average $79,012 per coin including fees and expenses. Its Nov. 9 filing also shows no sales in its STRF, STRC, STRK or STRD rows.
What the trade means for common shareholders
Repurchases can reduce future preferred dividend requirements, according to CryptoSlate. However, issuing MSTR increases the number of common shares, so existing holders share the remaining economics with more shares outstanding.
Whether the combined transaction improves value per share depends on the issuance terms, the repurchase price and the use of proceeds.
Reserve and cash serve different purposes
As of Nov. 8, Strategy held $4.77 billion in its USD Reserve and $146 million in USD Cash. The reserve is intended to support preferred-stock dividends and interest on outstanding debt, while USD Cash covers broader treasury purposes such as buying Bitcoin.
Strategy used $21 million of the reserve to pay preferred dividends during the week.
Source: CryptoSlate
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