The leading Wall Street Bitcoin miner in terms of market capitalization, MARA Holdings, Inc. (NASDAQ: MARA), has recently completed a significant $850 million offering of zero-coupon convertible senior notes. This offering stands out as one of the largest in the digital asset sector this year.
After factoring in initial purchasers’ discounts and commissions, the company has secured approximately $835.1 million in net proceeds. MARA intends to allocate $48 million towards repurchasing existing convertible notes due in 2026, with the majority of the funds earmarked for Bitcoin acquisitions and general corporate purposes.
These convertible notes come with unique terms, including zero regular interest and no principal accretion. Holders have the option to convert their notes into cash, MARA common stock, or a combination of both at the company’s discretion. The initial conversion rate is set at 28.9159 shares per $1,000 principal amount, approximately $34.58 per share – representing a 40% premium over recent trading prices.
$850 million with zero interest.
MARA has closed its second convertible note offering with 0% interest. The proceeds will primarily be used to acquire bitcoin and partially repurchase existing convertible notes due 2026.https://t.co/eepRdIPLnm
— MARA (@MARAHoldings) December 4, 2024
MARA had initially announced its plans for a $700 million convertible notes offering, with an additional $105 million, but the final amount exceeded expectations. The company’s shares saw a 3.3% increase during Wednesday’s Wall Street session, closing just below $26 and maintaining levels close to five-month highs.
Optional redemption rights starting June 5, 2029, and note repurchase requirements on June 4, 2027, and June 4, 2029, have been included in the notes. MARA has also granted initial purchasers a 13-day option to acquire an additional $150 million in notes.
MARA’s Expansion into Renewable Energy with Texas Wind Farm Acquisition
In a separate development, MARA has entered into an agreement to acquire a wind farm in Hansford County, Texas, signaling a significant expansion of its sustainable energy infrastructure. The wind farm boasts 240 MW of interconnection capacity and 114 MW of operational wind generation capabilities.
The company, headquartered in Fort Lauderdale, plans to establish and operate a data center powered entirely by the wind farm’s capacity, operating at zero-marginal energy cost. This strategic move aligns with MARA’s broader goal of leveraging sustainable resources for economic value.
Fred Thiel, CEO, MARA, Source: LinkedIn
“This acquisition demonstrates how the energy and data center industries can collaborate to create long-term value and promote sustainability,” said Fred Thiel, MARA’s Chairman and CEO.
“By repurposing machines and powering them with 100% renewable, zero-marginal energy cost, we are utilizing renewable resources that would have otherwise gone to waste, reducing our bitcoin production costs through vertical integration, and showcasing MARA’s commitment to environmental responsibility.”
Despite reporting a net loss of $124.8 million for the third quarter of 2024, MARA saw a 34.5% increase in revenue compared to the same period last year, reaching a total revenue of $131.6 million. The loss was primarily attributed to a $40 million rise in operational expenses, surpassing the growth in revenue.