While MicroStrategy (NASDAQ:) races to buy as much Bitcoin as possible, the AI-focused Chinese company is looking to cash in on the cryptocurrency’s year-to-date rally.
Meitu Co., Ltd. The technology company (Hong Kong:), known for its AI-powered beauty-focused apps, has announced the sale of its entire cryptocurrency portfolio, consisting of 31,000 units of and 940 units acquired in 2021.
The transaction resulted in a significant gain of $79.63 million (approximately RMB 571 million) with total cash of approximately $180 million (approximately RMB 1.3 billion).
The company’s board of directors announced plans to allocate approximately 80% of the net proceeds from this sale to pay a special dividend. This equates to approximately RMB457 million or HK$0.109 per share, representing a yield of 3.8% based on the current share price.
The remainder of the net profit will be used for business expansion. Meitu aims to use these funds to grow its subscription-based imaging and design products, which means a strategic focus on its core business offering.
morgan stanley (NYSE:) comments on Meitu’s recent moves and interprets them as a strong sign of the company’s operational focus and focus on increasing shareholder value.
“Selling all these crypto holdings for shareholder returns and business development is an important move for Meitu to focus on subscription-based products and create value for investors,” analyst Lydia Lin said in a note. I think this proves our determination.”
“We believe this is a turning point for the company’s position in the capital markets and investor presence, and represents a significant improvement in corporate governance.”
