Bitdeer, a Singapore-based Bitcoin mining and colocation provider, has announced a $150 million public offering of convertible senior notes due in 2029.
Bond Issuance Details
The notes will be senior, unsecured obligations of Bitdeer, maturing on August 15, 2029. Additional details such as the interest rate and conversion rate will be determined at the time of pricing. The company also plans to offer underwriters a 30-day option to purchase an additional $22.5 million in notes to cover potential over-allotments.
Use of Proceeds
Bitdeer intends to use the proceeds from this offering to expand its data centers, develop ASIC-based mining rigs, and meet general corporate needs. This offering follows similar moves by Marathon and Core Scientific, which raised $300 million and $400 million, respectively, through convertible notes to bolster their operations. The rise in debt financing comes as public Bitcoin mining companies face squeezed margins due to higher operational costs and reduced Bitcoin rewards.
Market Reaction and Context
Despite these fundraising efforts, Bitdeer’s stock price fell by 13% in pre-market trading on Thursday. The company had previously raised $150 million through stock offerings in the first half of 2024. This trend of increasing debt financing indicates that while equity financing slowed slightly from $1.9 billion in Q1 to $1.6 billion in Q2, mining companies are increasingly turning to debt to sustain their operations amid challenging market conditions.
The recent moves by Bitdeer and other companies to issue convertible bonds reflect their efforts to adapt to challenging conditions in the cryptocurrency mining market. It underscores their attempts to maintain operational stability and growth despite rising operational costs and reduced mining rewards.
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