The offering involves zero-coupon convertible senior notes set to mature in 2031.
To expand its Bitcoin portfolio, MARA Holdings ( formerly Marathon Digital Holdings Inc), the largest publicly traded Bitcoin miner on Wall Street, has taken an unexpected route. This follows after the company announced on December 2 that it has increased its convertible senior notes offering. That is, from $700 million to $850 million. However, the company also shared in its official statement that it would be using part of the net proceeds from this move to acquire more Bitcoin BTC $84 741 24h volatility: 0.5% Market cap: $1.68 T Vol. 24h: $11.65 B in the future and support other strategic initiatives.
MARA Seeks to Build a Robust Bitcoin Portfolio
Earlier on Tuesday, MARA’s X (formerly Twitter) account shared the announcement yet again, albeit with a sense of excitement.
MARA Holdings, Inc. Announces Pricing of Oversubscribed and Upsized Offering of Zero-Coupon Convertible Senior Notes due 2031https://t.co/3PYqjzn2A7
— MARA (@MARAHoldings) December 3, 2024
This enthusiasm serves as proof of the company’s confidence in Bitcoin’s value over the long term, even as it continues to find its way in an ever-competitive market.
As the announcement suggests, the offering involves zero-coupon convertible senior notes set to mature in 2031. These notes allow conversion into cash, common stock, or a combination of both. However, that will be solely at the company’s discretion.
According to MARA, it expects no less than $835 million in net proceeds. In fact, the company believes that the proceeds may rise even further to $982 million if additional notes are fully subscribed.
Whichever happens, MARA says, it will use a portion of the funds, around $48 million, to repurchase $51 million of convertible notes due in 2026. The major portion of the proceeds from the sale of the notes, however, will be used to buy more Bitcoin. Whatever is left may then be focused on corporate initiatives like strategic acquisitions.
Firm Eyes Crypto Sector Influence
Without a doubt, MARA has been aggressive in its Bitcoin acquisition approach. Particularly, in view of its recent buys. In November, the company added 703 Bitcoin, boosting its monthly total to 6,474 BTC.
Notably, the purchase followed a $1 billion zero-coupon note sale earlier in the year. That was when the firm committed $160 million as it sought to take advantage of the then-price dips.
As of this publication, MARA’s holdings now stand at an impressive 34,794 Bitcoin, which is worth $3.3 billion. This means it is now the second-largest corporate Bitcoin holder, coming in behind MicroStrategy, which has a portfolio worth $1.5 billion.
While MARA has been increasing its holdings, one might wonder what its ultimate goal is. There is the possibility that the acquisitions are geared towards making a profit. It is also a possibility that MARA is simply focused on Bitcoin’s long-term value and its function as a hedge against inflation.
Whatever the case may be, the upsized offering will undoubtedly accelerate MARA’s broader mission to expand its influence in the crypto sector. By using convertible debt instruments, MARA minimizes immediate financial strain and also secures enough resources for sustainable growth. If nothing else, this may just cement its position as a key player in Bitcoin mining.
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