Bitcoin mining company MARA Holdings is introducing a new $2 billion public stock offering to buy more Bitcoin.
This move continues the company’s strategy of getting BTC into the open market through capital raises while adhering to its “Hodl” agenda.
MARA secures new ATM equity program to fund Bitcoin purchases
According to a Form 8-K and latest prospectus filed with the U.S. Securities and Exchange Commission (SEC), MARA has set up an at-the-market (ATM) equity program with a group of investment banks, including Barclays, BMO Capital Markets, BTIG, and Cantor Fitzgerald, among others acting as agents.
Under the prospectus supplement, the shares will be sold from time to time at MARA Holdings’ discretion. The proceeds of the offering will be used mainly for the acquisition of Bitcoin in the open market.
“We currently intend to use the net proceeds from this offering for general corporate purposes, including the acquisition of Bitcoin and for working capital,” MARA said in its prospectus.
The company, which specializes in finance services and has a market capitalization of $4.7 billion, maintains a strong liquidity position with a current ratio of 4.94, indicating its ability to meet short-term obligations.
The shares’ sale will be conducted through methods deemed to be an “at the market offering” or through other methods upon agreement. The agents are entitled to a commission of up to 3% of the gross proceeds from each sale.
Simultaneously, MARA Holdings has revoked its at-the-market offering agreement dated October 24, 2023, which authorized the sale of up to $1.5 billion in common stock. No additional sales will take place under the previous agreement or its related prospectus supplement.
The firm has made it clear that this filing does not constitute an offer to sell the shares, and no sales will occur in states where such an offer or sale would be unlawful prior to registration or qualification under the securities laws of such state.
MARA follows Saylor’s playbook as It expands Bitcoin holdings
MARA’s current moves follow Michael Saylor’s playbook of issuing equity and convertible bonds to accumulate Bitcoin in the open market. The miner now has 46,376 BTC in its treasury—the second most among publicly listed firms, only behind MicroStrategy’s 506,137 BTC.
Despite being a Bitcoin miner, MARA has increasingly relied on buying Bitcoin on the open market. The company adopted this strategy last year amid recognition that mining BTC at a discount to the spot price was becoming increasingly difficult.
The industry has come under tremendous pressure following the latest Bitcoin halving event, which halved the rewards for mining and pressured profit margins against surging operational costs.
This means that acquiring Bitcoin from the open market has become a comparatively better strategy for miners wanting to increase their holdings and keep their mining operations going.
MARA’s action comes at a time when Bitcoin has been subject to increased volatility but ever-strong institutional interest. The last five years have seen MARA Holdings deliver a very large total shareholder return of 2881.63%, reflecting significant strides in transforming its business strategy.
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