Strive Proposes High-Yield Preferred Stock to Expand Bitcoin Holdings

Core Viewpoint - Strive, a Nasdaq-listed asset manager, is launching an initial public offering of a new class of preferred shares to pay dividends, aiming to raise funds for acquiring more bitcoin and expanding operations [1][2]. Group 1: Preferred Stock Offering - The Series A Variable Rate Perpetual Preferred Stock, named SATA, is designed to pay an initial 12% annual dividend, distributed monthly in cash [2]. - Strive plans to offer 1.25 million SATA shares to investors, with proceeds potentially allocated for bitcoin acquisitions, income-generating assets, working capital, or repurchasing common stock [2][4]. - A $12 per share dividend reserve will be established to cover the first year of distributions [5]. Group 2: Current Holdings and Market Position - Strive currently holds just under 6,000 BTC, valued at approximately $637 million, which could increase to around 11,000 BTC if the all-stock merger with Semler Scientific is completed [2]. - The company's common stock has experienced a significant sell-off, trading at a discount to the value of its bitcoin holdings, leading to a market net asset value (mNAV) below 1 [3]. Group 3: Market Context and Strategy - The decision to issue preferred stock is influenced by the actions of other bitcoin treasury firms, which have also begun issuing preferred shares to raise capital for bitcoin purchases [4]. - Strive intends to maintain SATA's trading range between $95 and $105 per share by adjusting dividend rates, with unpaid dividends compounding monthly, potentially reaching up to 20% annually [4]. - The offering occurs amid a broader decline in digital asset treasury stocks, many of which are trading below the value of their underlying holdings, restricting their ability to raise new funds [6].