Strive closes $630M SATS IPO, leaves Bitcoin allocation unspecified

The Bitcoin-focused company Strive successfully completed its oversubscribed initial public offering (IPO) of SATS preferred stock on October 20, raising $630 million in gross proceeds. However, the firm has not disclosed how much of these funds it intends to allocate towards purchasing Bitcoin (BTC).

Led by chairman and CEO Matt Cole, Strive currently holds approximately 36,818 BTC. If the company decides to purchase the maximum 7,372 BTC with its net proceeds, its holdings would rise to around 44,190 BTC, potentially surpassing Metaplanet's reported 44,000 BTC. The estimated net proceeds of $608.15 million, after accounting for underwriting discounts, commissions, and expenses, would be sufficient to acquire this amount of Bitcoin at an illustrative price of $82,500 per BTC, before deducting fees.

Strive intends to utilize the net proceeds for various general corporate purposes, including Bitcoin acquisitions, working capital, income-generating assets, capital expenditures, share repurchases, and acquisitions. The company's SATS shares, which carry a 15% annual dividend, were priced at $90 per share, with the company selling 7 million shares.

The dividends are cumulative and payable when declared by Strive's board of directors. At the IPO price, the stated dividend represents an annualized amount equal to 16.67% of the purchase price. Upon the company's acquisition of Bitcoin, the first dividend payment, scheduled to commence on November 9, would include accruals dating from the initial IPO closing on October 20.

Strive's chief risk officer, Jeff Walton, emphasized that the firm has no debt or maturities and is solely focused on fulfilling its obligation to pay dividends.