Marathon Digital, a Bitcoin miner, has announced plans to privately issue $700 million in convertible senior notes due in 2030 in order to restructure its debt, make potential Bitcoin acquisitions, and support corporate growth. The offering includes an additional purchase option for initial buyers and the notes can be converted into cash or stock. The company expects the fundraising to increase demand for its stock, potentially boosting its price. However, news of the offering has already caused a 6% drop in Marathon’s stock price.
This is Marathon’s second significant convertible notes issuance this year, following a $250 million raise in August. In October, the company also secured a $200 million Bitcoin-backed credit line from an undisclosed lender. Marathon controls a substantial portion of the Bitcoin mining industry, holding over 27,500 BTC worth approximately $2.5 billion according to Bitcoin Treasuries data. The company’s latest funding initiative reflects its commitment to solidifying its financial position and expanding its presence in the industry.
The unsecured notes will mature on March 1, 2030, and interest will begin accruing in March 2025. They will be sold privately to institutional buyers under Rule 144A, bypassing US securities registration. Marathon retains the right to redeem the notes for cash starting in March 2028 under specific conditions. The company expects noteholders with existing 2026 convertible notes to unwind their equity hedges, potentially increasing demand for its stock.
Marathon’s fundraising efforts are aimed at restructuring its debt, making potential Bitcoin acquisitions, and supporting corporate growth. The company’s significant presence in the Bitcoin mining industry positions it as a key player. The latest convertible notes issuance is part of Marathon’s ongoing efforts to solidify its financial position and expand its footprint in the industry. With this funding initiative, Marathon aims to support its general corporate initiatives and seize strategic opportunities in the evolving Bitcoin market.
