MARA Holdings Increases Convertible Note Offering From $700M to $850M Amid Investor Demand

MARA Holdings (MARA) has announced an increase in its previously planned convertible note offering from $700 million to $850 million amid strong demand from investors.

The company has also raised the option for initial purchasers to acquire additional notes from $105 million to $150 million, according to a recent press release.

The offering, directed at qualified institutional buyers, is set to close on November 20.

MARA’s Convertable Notes Will Bear No Interest

MARA convertables notes, maturing on March 1, 2030, will bear no regular interest and can be converted into cash, shares of MARA’s common stock, or a combination of both at the company’s discretion.

The initial conversion price is approximately $25.91 per share, representing a 42.5% premium over MARA’s current stock price of $18.18.

Estimated proceeds of $833 million are expected, with $199 million earmarked to repurchase a portion of MARA’s 2026 convertible notes.

The remaining funds will support Bitcoin acquisitions, asset expansion, and general corporate needs.

“MARA expects to use approximately $199 million of the net proceeds from the sale of the notes to repurchase $212 million in aggregate principal amount of its existing convertible notes due 2026 (the “existing 2026 convertible notes”) in privately negotiated transactions,” the firm wrote.

MARA, the second-largest publicly traded Bitcoin holder with 27,562 BTC, continues to position itself aggressively in the cryptocurrency market.

Following the announcement, MARA’s shares rose nearly 2% in pre-market trading, recovering slightly after a nearly 14% decline on Monday.

Why did $MARA fall off a cliff today? Especially after 2pm? Well now we know. It was to get the lowest possible conversion price for those who were about to buy the notes pic.twitter.com/PQ3sfAx75r

— 3DollarMARA (@dollar_mara) November 19, 2024

Major Bitcoin Holders Expand BTC Reserve

The announcement comes as other major Bitcoin holders like MicroStrategy and Metaplanet have expanded their Bitcoin holdings.

On Monday, Michael Saylor’s MicroStrategy revealed it has acquired $4.6 billion worth of Bitcoin.

The firm also announced plans to raise an additional $1.75 billion through convertible notes to increase its cryptocurrency holdings.

As of now, MicroStrategy holds 331,200 BTC, purchased at an average price of $88,627.

The current value of its Bitcoin stash places the company in a strong position, boasting an estimated $13.7 billion in unrealized profits.

To fund its Bitcoin acquisitions, MicroStrategy plans to issue senior convertible notes with a 0% interest rate, maturing in December 2029.

Likewise, Metaplanet recently announced plans to raise $11.3 million through a third series of ordinary bonds to support its Bitcoin acquisition.

The Japanese investment firm is issuing 1.75 billion yen worth of bonds with a 0.36% annual interest rate, set for redemption in November 2025.

Metaplanet’s director guarantees the bonds, which are not directly collateralized.

However, the land and building of Hotel Royal Oak Gotanda, owned by its subsidiary Wen Tokyo, serve as security for the bondholders.

According to Bitcoin Treasuries, the firm the company’s total Bitcoin investments is now worth over $64 million.

The ongoing macroeconomic uncertainties, characterized by increasing inflationary pressures and geopolitical tensions, have prompted corporate treasurers to explore the inclusion of Bitcoin as a reserve asset.

Just recently, digital asset prime services platform Abra launched a service designed for corporates seeking to hold cryptocurrencies as reserve assets on their balance sheets.