MARA Raises $950 Million Through Zero-Coupon Convertible Bond Placement
Date: 2025-07-29 Author: Gabriel Deangelo Categories: BUSINESS
The deal closed on July 25, 2025, and the securities mature in 2032. These bonds do not provide for regular interest payments, and investors were given the opportunity to purchase up to $200 million more bonds over the next 13 days.
After fees, the company received approximately $940.5 million in net proceeds, although this does not include costs associated with the issue. Of the proceeds, $18.3 million was used to buy back 1% bonds due in 2026, and another $36.9 million was used to finance hedging transactions with counterparties and market participants. The remaining capital will be used to expand the crypto portfolio, including the purchase of bitcoins, as well as to cover operating expenses, debt obligations and other business needs.
The bonds provide the right to convert into MARA common shares at a price of $20.26 per share, which corresponds to 49.3619 shares for every $1,000 of par value. Conversion is possible until May 1, 2032, subject to certain conditions being met, and after this date - at any time until the maturity date. The company may initiate an early redemption after January 15, 2030, if the market price of shares exceeds the conversion price by more than 30%.
Investors also have the option to request an early redemption on January 4, 2030, if the share price remains below the conversion price or if there are significant changes in the company's structure, such as a change in ownership. In certain situations, MARA has the right to change the conversion ratio, including corporate events or share buybacks.
To protect against capital dilution, MARA has entered into so-called capped call option agreements that limit losses and can increase the gain upon conversion. The upper limit of such options is set at $24.14 per share, which is 40% higher than the average market price recorded on July 23, 2025. These instruments can have both a positive and negative impact on the company's share price, depending on the hedging strategy of market participants.
