Shares of tech company Asset Entities (ASST) rose 194% on Wednesday after it announced that Strive Asset Management was merging with the NASDAQ-listed company to become a publicly traded Bitcoin (BTC) Treasury Company.
The deal, structured as a reverse merger, will leave the combined company operating under the Strive name and listed on the NASDAQ. Strive plans to build a sizable bitcoin reserve using novel investment and financing strategies designed to limit shareholder dilution.
One key strategy is a planned equity-for-bitcoin swap available to certain accredited investors, the companies stated in the press release. The exchange will use a tax provision known as Section 351, which allows appreciated assets to be contributed to a corporation tax-free in return for stock, subject to individual circumstances. The deal will not carry a premium to the company’s transaction price, according to the announcement.
Strive CEO Matt Cole, formerly a $70 billion fixed income portfolio manager, said the company aims to outperform bitcoin by using it as a benchmark for capital deployment. Strategies will include merging with overcapitalized firms to access discounted cash, employing leverage, and deploying structured products to hedge risk.
The company plans to expand its capital raising capacity to $1 billion post-merger through an effective shelf registration, offering flexibility to fund bitcoin purchases via equity and debt sales.
Strive has grown quickly since launching in 2022, managing roughly $2 billion and gaining attention for its opposition to ESG mandates. The merger, according to the company, is a next step in pushing for bitcoin adoption across corporate treasuries, a goal it will also advocate for among companies held in its funds.
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