Capital B Secures €7.6 Million in Private Placement
In a significant financial maneuver, Capital B has secured €7.6 million through a private placement led by notable investor Adam Back. This funding could facilitate the acquisition of an additional 376 Bitcoin (BTC), augmenting the company’s total holdings to 3,521 BTC.
Details of the Private Placement
On September 2, Capital B disclosed that Back has subscribed to a staggering 13,181,030 shares, each accompanied by four warrants, priced at €0.58 each. This subscription price indicates a 15.4% increase from the company’s closing share price on September 1. After accounting for associated fees and transaction costs, the net earnings from this placement are anticipated to be approximately €7.3 million.
The primary objective of the newly raised funds is to bolster Capital B’s Bitcoin reserves, aligning with its ongoing strategy to enhance Bitcoin holdings per fully diluted share. This investment follows closely on the heels of an earlier private placement for the same amount and share price.
Bitcoin Acquisition Plans
With the financing obtained through this recent investment combined with its operational capital, Capital B is poised to proceed with purchasing the additional 376 BTC. As it stands, the company’s Bitcoin reserve had already increased to 3,145 BTC after a separate acquisition of five BTC for €280,000 in August—a move that shifted its reserve from 3,140 BTC to the current count. The five BTC were purchased at an average price of €55,882 each, bringing the cumulative cost of its Bitcoin strategic reserves to around €284.2 million.
Warrants and Future Financing
The financing arrangement from September 2 entails shares bundled with warrants, specifically known as ABSA. Each of the shares comes with four different warrants, spread over three tranches with varying exercise prices and maturities: two Warrants 2026-06 at €0.75 each, one Warrant 2026-07 at €0.98, and one Warrant 2026-08 at €1.27, all having a five-year maturity.
Capital B holds the option to initiate an accelerated exercise period for any tranche if the average price of its shares exceeds 130% of the corresponding exercise price over a 20-day trading period. Warrants that remain unexercised will expire at the end of the accelerated period. Should Back opt to exercise all the warrants linked to this latest transaction, Capital B could secure an additional €49.43 million.
Previous Fundraising Efforts
The previous private placement, announced on August 28, generated €21 million and involved issuing 36.2 million shares with their own set of warrants, also priced at €0.58 per unit. This earlier fundraising, which attracted institutional investors including Back and asset management firm TOBAM, is expected to fund the acquisition of 270 BTC, potentially raising holdings to 3,415 BTC.
In May, Capital B utilized a similar funding strategy while raising €15.2 million, facilitating the acquisition of 192 BTC, thus increasing its holdings to 3,135 BTC then. Back, an already prominent shareholder with 54.3 million shares (14.82% of total ordinary shares and 12.31% on a diluted basis) prior to this latest transaction, will see his stake rise significantly to nearly 67.49 million shares post-placement. His ownership percentage will increase to 17.77% of the ordinary shares and 14.76% on a diluted basis.
Future Implications and Stock Split
Further exercises of the warrants from this recent deal could expand Back’s holding to approximately 120.21 million shares, translating to about 27.80% ownership on an ordinary basis and 23.36% on a diluted basis.
After the immediate issuance of shares, Blockstream Capital Partners would hold approximately 18.91%, while combined public and institutional investors constitute 53.43%. Executives would control about 5.59%, with TOBAM and UTXO Management owning 3.18% and 1.12%, respectively.
Back in June, Capital B secured investor approval for significant financing authority, allowing capital increases up to €5 billion and credit instruments totaling €100 billion, receiving over 95% favorable votes as part of their broader bitcoin treasury strategy.
The finalization of Back’s private placement is expected soon, specifically from September 3, although completion may face delays due to technical requirements. The newly issued shares will have rights equivalent to existing shares upon their listing on Euronext Growth Paris. It is also worth noting that Capital B plans a 10-for-1 reverse stock split on September 8, where ten existing shares will be consolidated into one new share. Consequently, the adjusted exercise prices for the latest warrants will be modified to €7.50, €9.80, and €12.70 respectively for the three different series of warrants.
