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Strive Raises $630M With SATS Preferred Stock Paying 15% Dividend
Daily dividend payments and Bitcoin expansion plans shape the upsized offering
TL;DR
- Strive raised $630 million through an upsized offering of SATS perpetual preferred stock.
- SATS carries a 15% annual dividend on its $100 stated value, with business-day payments planned from Nov. 9.
- Strive held 36,818 BTC as of Oct. 16 as CEO Matt Cole targets the No. 2 corporate Bitcoin position.
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Strive closed an upsized initial public offering of its Series A Perpetual Preferred Stock, branded SATS, raising $630 million in gross proceeds. The Bitcoin treasury company sold 7 million shares at $90 each, with a 15% annual dividend rate and cash payments scheduled for every business day starting Nov. 9 when declared by the board. Strive has identified Bitcoin purchases among the possible uses of the proceeds but has not set a specific allocation.
SATS offering expands from 5 million to 7 million shares
Strive initially planned to sell 5 million SATS shares before expanding the deal. The final offering carried $700 million in total stated value. A $3-per-share underwriting discount and other costs put estimated net proceeds at roughly $609 million, while BitcoinTreasuries.net calculated a more precise $608.15 million after underwriting discounts, commissions and expenses.
Trading on the Nasdaq Global Market was expected to begin Oct. 20 under the SATS ticker. SATS is cumulative and perpetual, meaning unpaid dividend amounts accumulate and the shares have no maturity date. Strive established an initial dividend reserve of $157.5 million, equal to $22.50 per share and enough to cover the first 18 months of payments. The first payment, if declared in full, is expected to cover dividends accrued since the Oct. 20 closing.
At the full stated rate, the newly issued SATS shares would require about $105 million in annual dividends if all payments are made. That amount excludes dividends on Strive’s other preferred securities. Chief Risk Officer Jeff Walton said Strive has no debt or maturities and described its principal obligation as “paying dividends.” Strive has also said its Bitcoin remains unpledged.
SATS sits below SATA in Strive’s capital structure
SATS joins Strive’s existing SATA preferred stock, which carries a variable dividend rate of approximately 13% and is managed with the objective of trading near its $100 stated value. SATA ranks ahead of SATS for dividend and liquidation claims, while both preferred issues rank above Strive’s ASST common stock. SATS carries a fixed dividend rate and does not include SATA’s active price-management mechanism.
Chief Investment Officer Ben Werkman characterized the distinction as SATA being designed for stable prices while SATS is designed for stable income. SATS’ effective offering yield also exceeded the rates listed for Strategy’s preferred issues in an Oct. 15 filing.
Barclays and Cantor served as bookrunners for the SATS sale, while Clear Street acted as lead manager. B. Riley, H.C. Wainwright, Maxim and StoneX were co-managers.
Strive targets second place among corporate Bitcoin holders
Strive held 36,818 BTC as of Oct. 16. The company acquired 4,045 BTC between Oct. 12 and Oct. 16, lifting its holdings to approximately $3 billion at recent prices. An 8-K filing covering a narrower period showed Strive purchasing 1,223 BTC for about $100 million between Oct. 14 and Oct. 16.
The holdings placed Strive fourth among the listed public corporate Bitcoin holders. Chairman and CEO Matt Cole has said he wants Strive to reach second place by the end of 2026. Based on the reported balances, Strive would need to acquire about 700 BTC per week to move past Metaplanet by that deadline.
Cole has also outlined a strategy targeting a 60% to 70% amplification ratio while Bitcoin trades below $100,000, using preferred capital to increase the company’s Bitcoin exposure relative to common equity. The SATS financing provides another source of capital without requiring Strive to issue additional common shares.
Bitcoin purchases remain one of several uses for the proceeds
Strive said proceeds may be used for general corporate purposes, including Bitcoin and Bitcoin-related purchases, working capital, income-producing assets, capital expenditures and share repurchases. The disclosed uses also include potential acquisitions and repurchases of Class A common stock or SATA preferred shares.
No fixed amount has been assigned to Bitcoin purchases. Using estimated net proceeds of $608.15 million and a Bitcoin price of $82,500, the funds could buy about 7,372 BTC, which would raise Strive’s holdings to roughly 44,190 BTC. A separate calculation using the full $630 million gross amount and a Bitcoin price near $82,000 produces an estimate of around 7,700 BTC before fees.
Strive ended Oct. 16 with $317.5 million in cash. Its advisory business, Strive Asset Management, is registered with the SEC and oversees more than $2.8 billion.
ASST shares were trading at $26.68, compared with a 52-week high of $36.20.
This article has been refined and enhanced by ChatGPT.
