Metaplanet to Offer Dividend-Paying Preferred Shares to Buy More Bitcoin, Echoing Strategy

In brief

Metaplanet plans to issue preferred shares as an additional funding mechanism.
The company expects $135 million from the initial issuance of “Mercury.”
The firm was valued at a slight premium to its Bitcoin holdings.

Metaplanet (MTPLF), the largest corporate holder of Bitcoin in Japan, unveiled changes to its capital structure on Thursday centering on the issuance of preferred shares.

The Bitcoin-buying firm plans to offer “Mars” and “Mercury” to investors as an additional source of funding, while making regular dividend payments, according to a regulatory filing.

Mars will feature a fluctuating dividend rate that aims to minimize the product’s volatility on secondary markets, Dylan LeClair, Metaplanet’s head of Bitcoin strategy, said on X.

Mars doesn’t have any conversion rights—where the preferred share could be exchanged for common equity—but it is senior to Metaplanet’s common shares and Mercury. Those qualities parallel Strategy’s STRF, which co-founder and Executive Chairman Michael Saylor once described as the company’s “crown jewel.”

Mercury, through quarterly payments, will offer a fixed annual dividend of 4.9% on a base amount of ¥1,000 ($6.35), with an initial distribution of ¥0.40 yen ($0.0025) for the current quarter. If Metaplanet’s shares rise above the ¥1,000 mark, which is nearly triple its current stock price, Mercury can also be converted into its common shares.

With an initial issuance of 23.6 million Mercury shares, Metaplanet said it is raising ¥21.2 billion ($135 million) from the offering that was extended to institutional investors. The shares were offered at ¥1900 ($5.71) apiece.

Metaplanet is positioning itself as the third Bitcoin treasury firm to offer preferred shares, following similar moves from Strategy and asset management firm Strive. Historically, these firms have issued common shares to grow their Bitcoin holdings.

In the filing, Metaplanet described the introduction of preferred shares as “essential to minimize dilution from common share issuances while continuing to expand its BTC holdings,” after its market cap slipped below the value of its Bitcoin holdings.

The move has recently grown less lucrative for Strategy as well, which has issued $7.7 billion worth of preferred shares. Year-to-date, the MSTR’s stock price has fallen 39%, with shares recently changing hands around $176, according to Yahoo Finance.

Strategy shares have traded at a discount to the company’s Bitcoin stockpile since Nov. 11, according to Bitcoin Treasuries. With $30,823 Bitcoin worth $2.67 billion on Metaplanet’s balance sheet, its market cap was slightly higher at $2.81 billion.

On Thursday, Metaplanet shares rose 3% to ¥387 ($2.46). Although the company’s stock price has halved over the past six months, it’s still up 11% on the year.