Technology
MicroStrategy’s Financial Gambit Hits a Bump With New Stock Deal
- Bitcoin proxy sold preferreds at big discount to pump interest
- 10% yield shows firm’s maneuver to open a new funding avenue
Michael Saylor
Photographer: Liam Kennedy/BloombergThis article is for subscribers only.
MicroStrategy Inc.’s seemingly limitless moves to raise capital for its Bitcoin purchases have run into their first obstacle.
The self-styled Bitcoin treasury company sold preferred stock units — rare, debt-like securities dangling an 8% coupon — last week, but it had to cater to price-sensitive buyers by pricing them at a sizable discount. The shares were sold for $80 apiece, 20% below their marketed price, effectively pushing the yield to 10% for buyers — a steep concession to finalize the deal.