Strategy (formerly MicroStrategy) has launched an At-The-Market (ATM) program for its 10% Series A Perpetual Stride Preferred Stock (STRD).
The initiative marks a significant milestone in the company’s evolution as both a technology innovator and a digital asset powerhouse, with the potential to issue up to $4.2 billion in new preferred shares.
The company’s new ATM program allows it to issue and sell STRD preferred shares in a flexible, market-driven manner. Unlike traditional offerings, ATM programs enable shares to be sold incrementally at prevailing market prices.
This provides the issuer with the agility to respond to investor demand and market conditions. This approach is increasingly favored by companies seeking to optimize capital raising without the constraints of large, one-time offerings.
Key Features of STRD Preferred Stock From Strategy
The STRD Series A Perpetual Preferred Stock is designed to appeal to yield-seeking investors while supporting Strategy’s ongoing Bitcoin accumulation and corporate growth.
Unlike some preferred stocks, STRD’s dividends are non-cumulative and not guaranteed. If the board of directors does not declare a dividend for any quarter, investors do not accrue unpaid amounts. This structure aligns with Strategy’s focus on financial flexibility and its commitment to Bitcoin as a reserve asset.
Proceeds from the ATM program are earmarked for:
- Bitcoin Acquisitions: Continuing Strategy’s role as the world’s largest publicly traded Bitcoin holder
- Working Capital: Supporting enterprise analytics software operations and corporate initiatives
- Dividend Payments: Providing liquidity for existing and future preferred shareholders
With traditional fixed-income yields still lagging, the 10% headline rate, equating to an 11.76% effective yield at the $85 issue price, offers a compelling proposition for investors willing to accept the associated risks.
The STRD preferred stock, with its high yield and unique risk profile, is poised to attract a diverse group of investors, from yield seekers to crypto enthusiasts, seeking exposure to the next chapter in financial innovation.
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