US-based digital energy and infrastructure company MARA Holdings announced plans to sell $850 million in non-interest-bearing convertible bonds due in 2032.
MARA Holdings Announces $850 Million Convertible Bond Sale Plan
The company will offer the notes exclusively to qualified institutional investors under Rule 144A of the Securities Act of 1933. Initial purchasers will also be given the option to purchase an additional $150 million of notes within 13 days of the initial issuance.
The bonds will be MARA's senior, unsecured debt instruments. Regular interest payments are not expected, but special interest rates may apply under certain conditions. The bonds mature on August 1, 2032. MARA will have the right to call all or part of these bonds for cash starting January 15, 2030.
Investors will be able to sell their bonds back for cash if the MARA share price is below the conversion price on January 4, 2030. The bonds may be converted into cash, shares, or a combination of the two, at MARA's discretion. The full conversion right will be valid in perpetuity, effective May 1, 2032.
MARA stated that the proceeds from the sale of bonds will be:
- To use the $50 million to buy back some of the 1% interest bonds due in 2026 that are currently in circulation,
- It plans to use the remainder to fund capped calls (anti-dilutive hedges on conversions), purchase additional Bitcoin, and for general corporate purposes (capital, debt repayments, strategic acquisitions).
The company anticipates that holders of bonds due in 2026 may purchase MARA shares to hedge their existing positions, which could put upward pressure on the stock price. Similarly, option counterparties under capped call transactions are also expected to purchase shares. These trades could cause volatility in the prices of MARA shares and bonds.
About the Company
MARA Holdings is a company that develops digital energy technologies and aims to transform energy systems. The company invests in digital infrastructure to increase energy efficiency in areas such as artificial intelligence and high-performance computing. It also supports grid stability by converting excess energy into digital capital.
*This is not investment advice.
