MicroStrategy to Increase Share Count for $42 Billion Bitcoin Acquisition
MicroStrategy plans to issue additional shares to enhance its Bitcoin acquisition strategy, aiming for $42 billion in Bitcoin through equity and debt funding. The stock, $MSTR, has increased by nearly 420% in 2024, paralleling Bitcoin's performance. A shareholder meeting is scheduled to approve modifications in the firm’s equity issuance policy to facilitate these acquisition efforts.
A recent SEC filing dated December 23 proposes increasing MicroStrategy’s authorized Class A common stock from 330 million to 10.33 billion shares and preferred stock from 5 million to over 1 billion shares. This expansion will provide the company greater flexibility for future funding needs, aligning with its 21/21 Plan to acquire $42 billion in Bitcoin over three years, financed by $21 billion in equity sales and $21 billion through fixed-income securities.
In December, MicroStrategy acquired 42,162 BTC, worth over $4 billion at current rates. This aggressive acquisition phase is based on the strategy of buying Bitcoin at peak prices for maximum returns. Michael Saylor stated, “If you are not buying Bitcoin at the top, you are leaving money on the table,” on X (formerly Twitter).
As of October, MicroStrategy reported a Bitcoin yield of 17.8%, targeting an annual yield of 6% to 10% from 2025 to 2027. The company has raised $13 billion through stock sales and $3 billion via convertible bonds; however, a temporary pause in Bitcoin purchases is anticipated in January due to a planned blackout period.
The rise in Bitcoin’s value throughout 2024 has notably improved MicroStrategy’s performance, resulting in its inclusion in the Nasdaq-100 and potential candidacy for the S&P 500 next year. Michael Saylor noted that treasury operations generated a Bitcoin yield equivalent to 3,177 BTC in one week, contributing a net benefit of $299 million to shareholders at $94,000 per BTC.
MicroStrategy remains the largest corporate Bitcoin holder, recognized for its relentless accumulation strategy under Saylor’s leadership. Other firms, such as Marathon Digital Holdings and Riot Platforms, have increased their Bitcoin purchases, yet MicroStrategy continues to lead. The firm’s approach demonstrates its commitment to leveraging Bitcoin’s bullish momentum.