Metaplanet faces a stock slump of over 50%, plans $884 M overseas fundraising via preferred share issuance to finance major Bitcoin accumulation strategy.
Metaplanet, a Japanese company, is in trouble. Its stock has dropped over 50% since mid-June. However, the company has a plan. It wants to raise $884 million by selling shares overseas. On September 1, shareholders will vote. They will determine whether to issue up to 555 million of common preferred shares. According to Bloomberg, Metaplanet expects to raise $3.8 billion. The idea is to purchase additional Bitcoin (BTC).
After 54% Collapse, Metaplanet Seeks Funding to Accelerate Bitcoin Accumulation
The stock of Metaplanet has gone down by 54% since mid-June. Meanwhile, the value of Bitcoin increased approximately 2%. This disparity is creating problems. The system in Metaplanet is the flywheel. Such a system requires increasing share prices. It opens financing with MS warrants. These warrants are issued to Evo Fund which is a major investor. But now, the stock price is low. Evo Fund has no intention of leveraging the warrants. This means that Metaplanet is poorer. This slows down its intention to purchase additional Bitcoin.
Related Reading: Metaplanet Boosts Bitcoin Holdings with $11.78M Purchase | Live Bitcoin News
Simon Gerovich is the owner of Metaplanet. He had been employed in Goldman Sachs as a trader. At this moment, Metaplanet has 18,991 BTC. This is why it is the seventh-largest holder of Bitcoin in public, according to BitcoinTreasuries. The company has big dreams. By 2026, it plans on holding 100,000 BTC. By 2027, it aims for 210,000 BTC. In order to do this, Metaplanet requires lots of money.
Metaplanet is no exception, as the person who advises it is quite famous. Eric Trump is the son of American President Donald Trump. He advises the company. He was also awarded with 3.3 million shares. People have taken an interest in Metaplanet due to this news.
Preferred Shares Could Help Metaplanet Buy More Bitcoin
Gerovich refers to the preferred shares as a defensive mechanism. These will be money earning shares. They will not hurt ordinary stockholders as long as the stock continues to decline. In addition, the stocks are likely to yield a maximum of 6 percent dividends annually. The Japanese investor prefers high dividends. In that way, these shares might be trending.
However, the stock slump is a big problem. It is difficult to attract investors because of the low share price. Evo Fund is not concerned with the warrants at the moment, as an example. It is a blow to Metaplanet in terms of cash. The company is therefore unable to purchase Bitcoin as quickly as it desires.
However, Metaplanet is struggling. Its stock has dropped a lot, but the company is not surrendering, though. It will sell shares to the tune of 884 million abroad. The September 1 shareholder vote matters. In case of passing the vote, the preferred shares might enable the required money to enter the picture. Gerovich and associates are interested in expanding the company’s stock holding of Bitcoins.
Lastly, they have big goals for 2026 and 2027. Shareholders are keeping an eye on it. They are interested in whether Metaplanet is going to succeed. The ability of the company to raise money and purchase additional Bitcoin determines its future.
