The Smarter Web Company (AQSE:SWC), a Bitcoin treasury and digital services business listed on the London Stock Exchange, saw its shares rise 6% to 32.98p after buying back three million pre-IPO warrants for £618,000, reducing the potential dilution of existing shareholders.
The company purchased the warrants at 20.6p each through a voluntary discounted offer to warrant holders, allowing them to realise value ahead of their scheduled vesting date. All warrants acquired under the offer will be cancelled.
The buyback was funded by drawing £650,000 from a $30 million credit facility provided by Coinbase, the cryptocurrency exchange, which The Smarter Web Company announced recently. The debt represents approximately 0.40% of the company's net asset value.
The company said the cancellation of the warrants improved its quarter-to-date Bitcoin yield, a metric used by Bitcoin treasury companies to measure the change in Bitcoin holdings per share, from -0.93% to -0.18%.
Chief executive Andrew Webley said the buyback reduced the fully diluted share count by 0.75%, representing a meaningful improvement during what he described as a challenging period for the Bitcoin treasury sector.
Webley added that the company had made significant structural progress this quarter, including the acquisition of digital agency Squarebird Agency Ltd, its uplisting to the London Stock Exchange main market and confirmation of inclusion in the FTSE UK Index Series.
The company said the £650,000 debt would be repaid through a combination of operational cash flow and future equity issuance.