Metaplanet is under increasing pressure from its shareholders as the share price falls. This threatens the model of fundraising that it used to create one of the world’s largest Bitcoin corporate treasuries.
Bitcoin has not stopped the company from losing 54% of its stock since June.BTCThe same period saw a gain of around 2%. This decline has forced its capital-raising “flywheel” A mechanism that relies on rising stock prices is used to release funding via MS warrants, which are granted to Evo Fund. This fund’s key investor.
Evo is less interested in exercising warrants now that shares have fallen sharply. Metaplanet has also slowed its Bitcoin acquisition plan. according Bloomberg’s Sunday Report.
Led by former Goldman Sachs trader Simon Gerovich, Metaplanet currently holds 18,991 BTC, making it the seventh-largest public holder, according to BitcoinTreasuries.NET. The company aims to reach 100,000 BTC before the end of 2020, and 210.000 BTC in 2027.
Related: Metaplanet, Smarter Web add almost $100M in Bitcoin to treasuries
Metaplanet expands overseas market
Its “flywheel” Gerovich turns to alternative methods of fundraising when strategy loses momentum. On Wednesday, Metaplanet announced plans to raise A public stock offering on foreign markets will raise approximately 130,3 billion yen (880 millions)
The shareholders are also voting on Monday to decide whether they approve issuing up to 5 million preferential shares. It’s a relatively rare instrument for Japan and could bring in as much as $3.7 billion.
Gerovich described the preferred share in an interview to Bloomberg as “a “defensive mechanism,” Allowing capital to be infusioned without diluting the common shares if stock prices fall further. The shares are expected to pay up to 6% in annual dividends. They will initially be capped at 25 percent of the company’s Bitcoins. This may attract Japanese investors who have been starved for yield.
Related: Metaplanet plans to raise additional $3.7B to buy Bitcoin
Metaplanet’s business strategy could be at risk if Bitcoin prices fall.
Analysts are still cautious. “The Bitcoin premium is what will determine the success of the entire strategy,” Eric Benoit from Natixis said. This premium, which is the difference between Metaplanet’s market capitalization and its Bitcoin holdings has dropped from 8x to 2x since June, thereby increasing the risk for dilution.
From Sept. 3 through 30, the company suspended Evo warrant exercise, paving the path for preferred stock issuing. This shift will determine if Metaplanet can maintain its funding strategy.
Metaplanet was upgraded to a large-cap from a mid-cap stock in FTSE Russell’s The September 2025 Semiannual Review has been included in the FTSE Japan Index. It follows strong Q2 results.
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Source: cointelegraph.com
