Bitcoin News Today: Mara to Raise $1B via Convertible Debt for Bitcoin Buys, Operations

Mara Holdings, one of the largest publicly traded cryptocurrency mining firms, has announced plans to raise up to $1 billion through a convertible senior debt offering. The company aims to use a portion of the proceeds to purchase Bitcoin (BTC) and support operational needs. The offering includes $850 million in 2032-due convertible senior notes, with an additional $150 million in optional principal available to institutional buyers. A maximum of $50 million from the proceeds will repurchase existing 1.00% convertible senior notes due in 2026, while the remainder will cover capped call transaction costs, Bitcoin acquisitions, and general corporate expenses. The unsecured notes will not bear interest, and the transaction remains subject to market conditions, with no assurance of closing [1].

The announcement builds on Mara’s recent strategic moves, including the acquisition of Two Prime, an institutional investment adviser managing $1.75 billion in assets. This deal expanded the amount of Bitcoin Two Prime manages on Mara’s behalf. In May 2024, Mara reported a 35% increase in BTC production despite rising mining difficulty and hashrate, alongside annualized mining revenue surpassing $752 million for the first time. As of publication, the firm holds 50,000 BTC, ranking it as the second-largest corporate Bitcoin holder after a top-tier treasury company with 607,000 BTC [1].

Earlier in March, Mara revealed plans to sell up to $2 billion in stock to institutional investors for Bitcoin purchases, mirroring strategies employed by major crypto treasury firms. The company emphasized that proceeds from both the debt and equity offerings will prioritize Bitcoin acquisitions and operational liquidity. However, the convertible note structure introduces flexibility for investors, who may choose to exercise the $150 million optional principal under favorable market conditions. The absence of interest payments and the reliance on market approval highlight the speculative nature of the offering, which aligns with Mara’s aggressive capital allocation strategy to scale its Bitcoin treasury [1].

The debt issuance underscores Mara’s commitment to leveraging financial instruments to accumulate Bitcoin, a trend observed among miners seeking to bolster reserves amid volatile market conditions. By prioritizing Bitcoin purchases, the firm aims to hedge against operational risks tied to mining profitability and further diversify its asset base. The transaction also reflects broader industry efforts to innovate capital structures, balancing debt obligations with long-term digital asset growth objectives.

Source: [1] [Mara to raise up to $1B for Bitcoin and operations via debt sale] [https://coinmarketcap.com/community/articles/6880e9ae91aa4249017f1010/]