Metaplanet Inc. (TYO: 3350, OTCQX: MTPLF) said on October 28 that it has formally adopted a Capital Allocation Policy, immediately putting in place specific guidelines for how it will raise and return capital as it continues to grow its Bitcoin treasury.
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Under the new policy, the company will:
- Issue perpetual preferred shares to fund further Bitcoin purchases, with a goal of listing these securities promptly to manage refinancing risk and enhance its BTC Yield (note: BTC Yield is percent growth in bitcoin per assumed diluted shares)
- Halt common-share issuances whenever its mNAV (enterprise value divided by BTC NAV) falls below 1x, effectively preventing dilution when the shares trade at or beneath intrinsic value of bitcoin holdings. Issuances may resume only once mNAV exceeds that threshold and both strategic and financial criteria are met.
- Begin share repurchases whenever its common stock trades below its intrinsic value, with flexibility to buy back shares with cash on hand, proceeds from preferred-share offerings, credit facilities or income from its Bitcoin Income Generation business. The board has authorized an open buyback program to execute these purchases.
Collectively, these measures aim to balance Metaplanet’s capital raising needs with proactive buybacks and more accretive issuances. The policy takes effect immediately, and Metaplanet will provide regular updates on its mNAV levels, preferred-share issuance, and buyback activity going forward.
Metaplanet had briefly fallen below 1x mNAV and at the time of writing its dashboard reports a 1.03x mNAV. TYO:3350 shares are down 74% (measured in Japanese yen) from their highs on June 16.
Recently Metaplanet suspended dilution on its common stock issuance.
Read More: Metaplanet launches U.S. arm, raises $1.4 billion in international offering
3350 was up 2.2% during today’s Tokyo trading session.
