Saylor’s Strategy Restarts Bitcoin Buying, Spending $370 Million

• BTC-USD
• MSTR

(Bloomberg) — Strategy Inc. resumed Bitcoin purchases after a 10-week pause, returning to its signature accumulation strategy after the crypto bear market pressured its shares, weakened confidence in the financing model and prompted a balance-sheet overhaul.

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The original Bitcoin treasury company — co-founded and run by Michael Saylor — bought $369.7 million of the tokens in the week ended Aug. 30, according to a filing on Monday. The largest buyer of Bitcoin also raised $602.8 million through the sale of common stock to help fund the purchases and bought back $151.8 million of preferred shares.

Strategy’s latest Bitcoin purchase comes as conditions around its financing model have improved modestly. Bitcoin’s rebound toward $80,000 has helped lift Strategy’s shares and pushed the market capitalization of the company closer to the value of its Bitcoin holdings. The firm holds around $73 billion in Bitcoin.

The company has also been reshaping its balance sheet. Last week, it created a separate cash pool alongside its existing reserve, giving management more flexibility to meet preferred-stock dividends, debt payments and other corporate needs. The two reserves total $5.1 billion and $1.61 billion, respectively.

Still, the recovery remains limited. Strategy’s shares continue to trade far below the richer valuations seen earlier in the cycle, when issuing stock gave the company a much easier way to raise money for additional Bitcoin purchases. The recent rebound has improved that backdrop, but has not restored the financing engine that powered its earlier accumulation.

The common shares rose around 2% in pre-market trading. The stock is down around 60% in the past year.

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Source: finance.yahoo.com