Sequans (SQNS): Selling Some of its BTC Stack

Sequans Communications sold 970 Bitcoin to reduce its convertible debt from $189 million to $94.5 million, making it the first bitcoin treasury firm to sell part of its holdings. The company's BTC reserves now stand at 2,264 BTC, valued at approximately $240 million, which lowers its debt-to-net asset value ratio from 55% to 39%. CEO Georges Karam described this decision as tactical and market-driven, asserting that the company's core operational integrity remains intact. With decreased leverage, Sequans aims to expand its capital market options, including an ADR buyback program and potential preferred stock issuance. Despite the positive debt reduction, Sequans’ ADRs dropped another 9% and are down 82% for the year. The firm’s stock price collapse reflects a broader trend among firms with significant BTC holdings facing challenges in capital raising, leading some to sell BTC to manage debts. This situation raises questions about the future of bitcoin treasury strategies and market conditions.

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