Andrew Bary
MicroStrategy Chairman and controlling shareholder Michael Saylor has grand ambitions and is one of the world's biggest champions of Bitcoin.
Now the company is asking shareholders for approval to boost the authorized amount of the company's class A common shares outstanding to 10.33 billion from the current 330 million, accord ing to a preliminary proxy filing with the Securities and Exchange Commission late Monday.
That would be enough stock at the current share price to purchase all of the world's Bitcoin -- nearly 20 million coins -- at the current Bitcoin price of around $95,100.
MicroStrategy shares finished Monday at $332.23, down 8.8%. If the company, which now has about 244 million basic shares outstanding (including nearly 20 million supervoting B shares held by Saylor), were to issue 10.33 billion shares, it would be worth $3.4 trillion, more than the current $1.9 trillion value of the world's Bitcoin.
The company has been on an equity-issuance spree since late October when it announced plans to sell $21 billion worth of stock and a similar amount of bonds to buy Bitcoin through 2026.
Since then, it has issued about $13 billion worth of stock and $3 billion worth of convertible bonds under that authorization and used the proceeds to buy Bitcoin. The company now holds 439,000 coins worth about $42 billion. It owns just over 2% of the world's Bitcoin and is the largest corporate holder in the world.
The company noted in the filing that it has been executing on that plan "significantly faster than originally anticipated."
The company has capitalized on the premium that its stock trades relative to Bitcoin to issue shares and buy the cryptocurrency. That premium is now around two times with the company valued at about $81 billion -- it has $7 billion of debt outstanding.
With about 223 million basic A shares outstanding and 260 million fully diluted A shares outstanding (based on a company calculation) , MicroStrategy could be bumping up against its current share authorization of 330 million shares next year if it continues to issue stock. But the amount the company seeks is a huge number and reflects Saylor's desire to be king of the Bitcoin market.
Write to Andrew Bary at andrew.bary@barrons.com
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December 24, 2024 09:39 ET (14:39 GMT)
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