Super League Enterprise seeks share issuance vote for 2,100 Bitcoin deal
The Oct. 16 proposal seeks approval for up to 435,859,500 shares, with control passing to Metaplanet Holdings if the deal closes.
Julian Okafor
A proposed share issuance linked to 2,100 Bitcoin would make a Japanese treasury group's U.S. subsidiary the controlling shareholder of a Nasdaq issuer if the deal closes. Super League Enterprise, Inc. NASDAQSLE, a Santa Monica gaming advertising company, is asking holders to approve issuing up to 435,859,500 common shares at its Oct. 16 annual meeting, according to its Sept. 25 definitive proxy. Metaplanet Inc. TYO3350, a Tokyo-listed Bitcoin treasury company, would contribute the coins. Metaplanet Holdings, Inc., the Japanese company's wholly owned Florida subsidiary, would receive its allotment of shares and become the direct controlling holder if the transaction closes.
The planned contribution comprises 2,100 Bitcoin, Super League said in its Oct. 6 letter. Using Coinbase's 4:00 p.m. New York closing price on Oct. 2, the company valued those coins at approximately US$179 million. At the same closing time on Aug. 14, it valued them at approximately US$132 million. The roughly US$47 million difference reflects the change in the price used for the same number of coins, while the contribution remains conditional on closing.
Super League shares closed at US$4.76 on Nasdaq on Oct. 7, down 5.37 per cent, according to the NASDAQSLE quote at 4 p.m. EDT that day. The Oct. 6 letter followed the transaction announcement in August, so that single closing price does not establish what drove the move.
The Sept. 25 definitive proxy asks stockholders to approve issuing up to 435,859,500 common shares under the transaction's subscription agreements. It estimates Metaplanet Holdings would hold 44,859,400 common shares, or about 95.7 per cent of Super League's issued and outstanding common shares, immediately after closing before exercise of related warrants and conversion of preferred shares. The calculation uses the proxy's Aug. 17 share count, so it is a transaction assumption rather than a current ownership figure.
Share Approval Would Shift Control
The share issuance proposal would produce a change of control under Nasdaq rules if approved and completed, the definitive proxy says. Metaplanet Holdings would gain rights to designate or nominate a majority of Super League's board, and Super League would become a controlled company under those rules. Existing holders would retain shares in the Nasdaq issuer, but the subsidiary would control its governance on the proxy's assumptions.
The definitive proxy also models full exercise of warrants for Metaplanet Holdings and Evo Fund, the Cayman Islands company that signed the second subscription agreement, and conversion of the preferred shares. On the Aug. 17 share base, the subsidiary would hold 425,859,500 common shares, or approximately 97.3 per cent of the fully diluted total, under that scenario. The proxy excludes certain other outstanding instruments from the denominator, so neither this percentage nor the 95.7 per cent initial estimate is a current stake.
Super League chairman and chief executive Matt Edelman described the planned transfer in his letter:
"Upon successfully closing this transaction, Metaplanet is expected to contribute 2,100 of its own Bitcoin to Super League and become the Company's controlling stockholder," Edelman wrote in the Oct. 6 letter.
The same letter says the shares received at closing and any shares obtained from related securities are subject to a five-year lock-up. That limits the share recipient's ability to sell stock under the agreement, but does not fix a price for the 2,100 Bitcoin.
The October Valuation Remains A Snapshot
The Oct. 6 letter warns that Bitcoin's price can move sharply and offers no closing-date price forecast. Its Oct. 2 valuation is a market-price estimate for a proposed in-kind contribution. A different Bitcoin price at closing would produce a different dollar value for the same 2,100 coins.
Super League said in the letter that its gaming media and advertising operation would continue after closing, alongside the proposed Bitcoin treasury business. It also said the combined company would take the name Superplanet, Inc. The company's proposed continued Nasdaq listing after closing is subject to Nasdaq approval, according to the Oct. 6 letter.
Mugglehead's Oct. 6 coverage of Metaplanet's capital policy followed the Japanese company's plans for deploying capital. The Super League transaction identifies a specific U.S. vehicle and a specific pool of 2,100 Bitcoin, with the receiving company's share issuance now before its holders.
Read more: Metaplanet sets 10-15 per cent strategic investment range under capital policy
Super League's Oct. 6 letter says other conditions remain before the transaction can close. The next test is the Oct. 16 annual meeting, when shareholders will vote on the share issuance proposal in the definitive proxy.
