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walkitoutRecently, a friend heard some bit about “treasury companies” on Bloomberg? CNBC? Something else? I don’t recall. And he didn’t know what treasury companies meant in that context, but it sounded like he thought it was something crypto tracking treasuries. I gave a vague and pointless answer, and then belatedly realized, NO ACTUALLY you probably heard about public companies buying Bitcoin or whatever, and how the purchases result in a larger stock price than the amount those purchases increase Net Asset Value, which is weird, and kind of a perpetual money machine until it isn’t.
Anyway. There is also something called a SPAC, which is a different way for a private company to go public than the more normal ways such as an IPO or a direct listing.
In today’s Matt Levine column, there’s an extensive discussion of how SpaceX just bought some of EchoStar’s spectrum (presumably for StarLink), and didn’t pay exclusively in cash, but rather used some of SpaceX’s stock.
“SpaceX treasury company
One recurring theme around here is that ordinary investors want to buy SpaceX stock, but they mostly can’t. SpaceX is a private company; it is not allowed to sell stock broadly to the general public, and it mostly doesn’t want to.
…
it didn’t sell its spectrum to SpaceX for cash, or not just for cash. It sold the spectrum to SpaceX for $8.5 billion of cash and $8.5 billion of SpaceX stock, with the cash going largely to pay down debt.”
Anyway. The most hilarious outcome here is for EchoStar to keep selling spectrum to SpaceX and keep paying down debt and eventually EchoStar and SpaceX merge and SpaceX is public and anyone who owned EchoStar from the early days winds up swimming in it?”
Dish Network parent stock ownership being a good way to kinda own SpaceX stock was never on any of my expectations, so this is delightfully weird.
No I don’t own any stock in any of this stuff.
Anyway. There is also something called a SPAC, which is a different way for a private company to go public than the more normal ways such as an IPO or a direct listing.
In today’s Matt Levine column, there’s an extensive discussion of how SpaceX just bought some of EchoStar’s spectrum (presumably for StarLink), and didn’t pay exclusively in cash, but rather used some of SpaceX’s stock.
“SpaceX treasury company
One recurring theme around here is that ordinary investors want to buy SpaceX stock, but they mostly can’t. SpaceX is a private company; it is not allowed to sell stock broadly to the general public, and it mostly doesn’t want to.
…
it didn’t sell its spectrum to SpaceX for cash, or not just for cash. It sold the spectrum to SpaceX for $8.5 billion of cash and $8.5 billion of SpaceX stock, with the cash going largely to pay down debt.”
Anyway. The most hilarious outcome here is for EchoStar to keep selling spectrum to SpaceX and keep paying down debt and eventually EchoStar and SpaceX merge and SpaceX is public and anyone who owned EchoStar from the early days winds up swimming in it?”
Dish Network parent stock ownership being a good way to kinda own SpaceX stock was never on any of my expectations, so this is delightfully weird.
No I don’t own any stock in any of this stuff.