On Thursday, MARA Holdings announced that it has completed a $1 billion offering of 10-year zero-coupon convertible senior notes. The majority of the proceeds will be used to fund future Bitcoin purchases.
The offering included an initial principal amount of $850 million and an additional $150 million pursuant to the option granted to the initial purchasers. Due to strong investor demand, MARA decided to increase the total offering from the initial target of $700 million to $1 billion.
The company raised approximately $980 million in net proceeds after deducting discounts and commissions to the initial purchasers. MARA plans to use around $199 million to repurchase $212 million of convertible notes due in 2026. The remaining funds will be allocated to purchase Bitcoin and for general corporate purposes.
These notes will mature on March 1, 2030, and will be convertible into cash, common stock of MARA, or a combination thereof, at the company's election. The initial conversion rate is 38.59 shares per $1,000 of principal amount, equivalent to a conversion price of $25.91 per share. This represents a 42.5% premium over MARA's $18.18 Medium trading volume on November 18, 2024.
As noted in the press release, holders may require MARA to repurchase the notes on December 1, 2027, or upon certain fundamental changes at 100% of the principal amount. Starting March 5, 2028, MARA may redeem the notes if their stock price reaches 130% of the conversion price for a specified period.
These notes are senior unsecured obligations and will not pay regular interest. MARA may pay special interest annually starting March 1, 2025, as a remedy in the event of reporting covenant breaches or certain other circumstances.
MARA is committed to a full Bitcoin treasury HODL policy, retaining all mined BTC and executing strategic Bitcoin purchases.
As one of the largest publicly traded Bitcoin holders, MARA currently holds approximately 27,562 BTC, valued at around $2.5 billion.
You can view the BTC price here.
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Minh Anh
According to CryptoBriefing
