Riot Platforms today announced that it has completed its offering of 0.75% convertible senior notes due 2030 to raise $594.4 million. The Bitcoin mining company used the additional proceeds from the convertible notes issuance to acquire 667 Bitcoin at a price of $101,135 per token, bringing its total Bitcoin holdings to 17,429 Bitcoin.
Riot has returned 37.2% YTD and 36.7% Q4 on its recent Bitcoin acquisition and YTD mining output. Its total Bitcoin holdings currently stand at $1.8 billion at an average market price of $103,873.
Riot Platforms Closes Convertible Token Offering
With additional proceeds from Riot’s $594 million convertible bond issuance, at 0.75%, the company acquired 667 BTC at an average price of $101,135 per BTC. As a result, Riot increased its holdings to 17,429 BTC, currently valued at $1.8 billion based on... pic.twitter.com/t68Uy8nbHU
— Riot Platforms, Inc. (@RiotPlatforms) December 16, 2024
According to Riot Platforms, the aggregate principal amount of the 2030 Notes sold in the offering includes $69.4 million in connection with the partial exercise of the initial buyer’s option. The net proceeds from the issuance of the 2030 Notes were approximately $579.2 million after deducting initial buyer discounts, commissions and estimated offering expenses payable by Riot.
The Bitcoin miner revealed that the 2030 bonds were sold in a private offering only to persons who are reasonably considered qualified institutional buyers under the Securities Act. All net proceeds were quickly deployed into additional Bitcoin acquisitions.
According to Stock Titan, the successful completion of the convertible note offering represents a significant increase in Riot’s capital. The convertible structure provided flexibility for future conversions of shares while minimizing immediate dilution. However, investors should note that the large Bitcoin acquisition exposed Riot to increased cryptocurrency volatility, although the low interest rate indicates favorable market conditions. The 2030 maturity also provided a long runway for the company’s growth strategy.
Riot’s capital raising represents one of the most significant fundraising events in recent times in the cryptocurrency mining sector. It signaled institutional confidence in the company’s business model and demonstrated Riot’s commitment to future operational expansion.
Riot Platforms Doubles Down on Bitcoin with Major Additional Acquisitions
On December 9, Riot announced its intention to use all of the proceeds from the offering to buy more Bitcoin, and continued its plan to acquire 667 Bitcoin on December 16. The company has already used a portion of the net proceeds from the offering to raise over 5,000 Bitcoin between December 10 and 12.
Riot Platforms has increased its Bitcoin holdings to 17,429, signaling plans to significantly expand Bitcoin and potentially impacting its financial strategy. BitcoinBitcoin and held to enhance shareholder value. Riot reported a BTC return key performance indicator that indicates a quarterly return of 36.7% and an annual return of 37.2%.
According to Riot Platforms, the BTC Yield KPI can only be used by professional investors to supplement their understanding of a company’s decision to fund its purchase of Bitcoin by issuing additional shares of its common stock. Riot emphasized that the BTC Yield KPI is not equivalent to “yield” in a traditional financial context because it cannot be used as a measure of operational performance or liquidity.
InvestingPro analysts expect the recent BTC acquisitions to push Riot’s revenue growth to 32% in 2024. InvestingPro data also showed that the company has maintained a healthy balance sheet with more cash than debt and a healthy current ratio of 5.86x. Tron stock has also performed well recently, returning 16% over the past week and 23% over six months.