Forward Industries gains nearly 20% riding 500K SOL acquisition momentum

The Solana-focused treasury firm, Forward Industries (NASDAQ: FWDI), saw its shares climb roughly 17% after it disclosed its purchase of more than 500,000 SOL.

The firm now holds a total of 7.55 million SOL tokens. It spent about $38 million on its most recent Solana purchase, paying an average price of $79 per token. 

Forward expands Solana position 

Forward Industries experienced a roughly 17% increase in its stock price after it announced a purchase of over 500,000 SOL tokens, bringing its total holdings to 7.55 million. With Solana trading near $77, the firm’s full treasury is currently sitting at roughly $579 million. Its most recent purchase cost an average of $79 per token, bringing the total to $38 million. 

Forward now controls more SOL than its three closest publicly traded competitors combined. Solana Company, DeFi Development Corp., and Upexi collectively hold around 6.7 million tokens. 

To fund its purchases, Forward sold 93,642 common shares through its at-the-market equity program during its fiscal third quarter. At the same time, it repurchased stock when shares traded below the net asset value of its SOL holdings.

Through this strategy, the company grew its SOL-per-share number to 0.0729 from 0.0669 in the prior quarter, representing an annualized growth rate of 36%. Common shares outstanding fell slightly to 73.8 million from 76.3 million over the same period.

The company believes it has a strong position because it was recently added to the Russell 2000 and Russell 3000 indexes. Chief Investment Officer Ryan Navi said this gives the company better access to institutional capital.

The company also uses its SOL tokens as collateral to borrow money. It borrows at a lower cost than the return it earns from staking its tokens, which is between 6.4% and 7.3%.

How has the price of Solana affected Forward Industries’ holdings?

Despite the current increase in Forward’s stock price, FWDI shares have dropped about 26% over the past six months and trade roughly 89% below their 52-week high of $46. 

Forward acquired the bulk of its SOL last year at an average cost near $232 per token, when it spent roughly $1.6 billion to build a position of 6.8 million SOL. But with the token now trading in the mid-$70s, unrealized losses on the overall position exceed $1 billion.

Cryptopolitan reported earlier in June that on-chain data from Arkham Intelligence showed the company depositing more than 455,000 SOL to Coinbase Prime and unstaking another 500,000 tokens through Sanctum. Those moves fueled speculation that Forward was selling into the downturn to manage cash needs.

Cryptopolitan also reported in June that the company attempted to expand by acquiring other companies that hold large amounts of Solana. Acquisition proposals were sent to Solana Company (NASDAQ: HSDT), Brera Holdings, and SkyAI, offering all-stock deals at premiums of 10% to 20%, but all three targets either rejected the offer or let it expire without responding.

Navi has argued that smaller Solana treasury firms face structural challenges from high fixed costs and thin liquidity, but the rejections suggest those companies do not share his view that consolidation is the answer.