Sequans Communications (NYSE: SQNS) is creating headlines after announcing plans to sell up to $200 million in shares through the AT-The-Market (ATM) equity program.
The Paris-based chipmaker has one of Europe’s boldest financial strategies. The goal is to retain 100,000 BTC by 2030. Once achieved, this is almost 0.5% of all Bitcoin that exists.
Sequans currently owns 3,171 BTC, worth around $350 million, making it the second largest corporate Bitcoin holder in Europe after Germany’s Bitcoin Group SE, according to Bitcoin Treasuries.
The new $200 million equity program will allow the company to purchase around 1,800 BTC at its current price, bringing its holdings at about 5,000 BTC, the same as US-based Semler Scientific.
CEO Georges Karam said it is part of the construction of the Long-Term Finance Foundation. “We intend to use it carefully to optimize the Treasury Department, increase Bitcoin per share and provide long-term value to shareholders.” He said in a recent company announcement.
This offer allows bread to issue American Deposited Stock (ADS) at its discretion, in accordance with market conditions. ADSS allows US investors to trade stocks in foreign companies on US exchanges.
This is not the first time Sheban has raised Bitcoin funds.
In July, the company raised $189 million through secured convertible bonds and warrants, increasing its recent total funding to about $376 million. With the new $200 million plan, Sequans will raise nearly $576 million for its Bitcoin financial strategy.
Industry officials say it’s a big bet. On the one hand, it places span at the forefront of corporate Bitcoin adoption. Meanwhile, it exposes the company and its shareholders to the risk of Bitcoin volatility.
Analysts are divided into these decisions. Increased fairness to buy Bitcoin dilutes existing shareholders, but also offers long-term benefits. In this way, shareholders will accept dilution in hopes of long-term profits from Bitcoin growth. Still, strategy requires discipline.
Companies with low finance can effectively accumulate using structured funding, options strategies, or transactions backed by BTC.
Critics argue that unlike the US companies that have pioneered the model, they don’t have enough margins to survive the billion-dollar war chest or extensions on their own.
If Bitcoin rises, the span wins. If that goes down, investors lose to effectively support Bitcoin Proxy on behalf of semiconductor companies.
Sequans wants to become a Bitcoin proxy stock rather than just a chip maker. Whether this works will depend on the Bitcoin path for the next few years.
CEO Georges Karam says it’s a long-term play. He points out that their strategy demonstrates strong belief in Bitcoin as an asset and long-term investment.
