Metaplanet, a Tokyo-listed company, has announced the issuance of $135 million in perpetual preferred shares as part of its ongoing strategy to expand its Bitcoin treasury management. This move comes amidst increasing scrutiny of companies heavily invested in digital assets and follows renewed support for Bitcoin treasury models from Michael Saylor, founder of Strategy.
Metaplanet Raises Capital Through Perpetual Preferred Shares
The Japanese company’s board approved the issuance of 23.61 million class B preferred shares on November 20, targeting allocations to foreign institutional investors.
The net proceeds are estimated at ¥20.41 billion ($130 million) after fees, with payments scheduled for December 29, pending shareholder approval at a special general meeting on December 22.
The preferred shares, branded as “MERCURY” (Metaplanet Convertible for Return and Yield), come with a fixed dividend of 4.9% and a conversion price set at ¥1,000 per share.
Each preferred share entitles holders to annual dividends of ¥12.25 ($0.08), distributed quarterly, although the initial period ending December 31 will yield only ¥0.40 ($0.003) per share.
With the conversion price significantly above Metaplanet’s closing price of ¥375 ($2.40) on November 19, concerns about short-term dilution remain limited.
Deputy Director Simon Gerovich stated that this structure is designed to “minimize dilution due to common stock emissions while continuing to expand BTC holdings,” calling it a significant step in Metaplanet’s Bitcoin treasury strategy.
Despite trading below its Bitcoin reserves, Metaplanet has continued to bolster its position in digital assets and has recently announced a ¥75 billion share buyback program, supported by a $500 million credit facility.
Saylor Reaffirms Commitment to Bitcoin Treasury Model
Meanwhile, Michael Saylor, founder and Executive Chairman of Strategy, dismissed concerns over market volatility during an interview with CNBC on November 14.
He asserted that Strategy “can withstand an 80% to 90% decline and continue to operate,” referencing a minimal leverage of only 1.15 times and long-term debt maturities of 4.5 years.
Saylor highlighted Bitcoin’s historical performance, showing an average annual return of 50% over the past five years despite multiple significant downturns, as evidence of its suitability as a corporate treasury asset.
He noted that Strategy’s five-year performance of 71% outperformed Nvidia, claiming no company in the S&P 500 has matched its returns.
However, Strategy faces the risk of removal from the MSCI USA and Nasdaq 100 indices following proposals to exclude companies whose digital assets exceed 50% of total assets.
JPMorgan estimates that exclusion from MSCI alone could lead to $2.8 billion in passive outflows, with decisions expected by January 15.
Strategy’s stock has fallen over 60% from its November 2024 peak but remains up more than 1,300% since it began acquiring Bitcoin in August 2020.
Bitcoin Treasury Companies Navigate Premium Compression
The broader Bitcoin treasury sector has entered what Coinbase Research describes as a “player-versus-player” environment.
Premiums relative to net asset values have contracted, dropping from 3.76 times in April to 2.8 times, while corporate adoption of Bitcoin has plummeted by 95% since July.
Among 168 listed treasury companies, 26 are now trading below their digital asset values.
Metaplanet was the first major firm to regularly trade below its reserves, prompting accelerated capital restructuring efforts.
The firm aims to cap its issuance of preferred shares at 25% of the net value of its Bitcoin assets, seeking to enhance its credibility in the preferred stock market while expanding its treasury.
The strategy continues to aggressively accumulate Bitcoin, purchasing 8,178 BTC this week at an average price of $102,171, raising its holdings to 649,870 BTC.
Saylor asserts that Bitcoin will continue to outperform traditional assets, describing it as “digital capital” suited for long-term investors.
John is a seasoned journalist at The Bothside News, specializing in balanced reporting across news, sports, business, and lifestyle. He believes in presenting multiple perspectives to help readers form informed opinions. His work embodies the publication’s philosophy that truth emerges from examining all sides of every story.
