Coinbase sparked interest in crypto corners when it announced its intention to repurchase a slice of its $1bn corporate bond pie on Tuesday. This move will see the cryptocurrency trading platform buying back up to $150m of its bonds due to maturity in 2031. This initiative expires on 1 September 2023.
Coinbase plans to buy back corporate bonds
Citigroup Global Markets will handle this offer, which follows a tiered structure that rewards early engagement. This entails a premium of $645 for every $1,000, or 64.5 cents per dollar, of a bond’s value for those selling their bonds before 18 August 2023. The deal includes a special early-tender premium of $30.
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Investors choosing to part with their bonds after 18 August 2023 but before the cut-off date, will receive $615 for every $1,000 of a bond’s nominal value or 61.5 cents per dollar. Interestingly, these offer prices top the price of the bond, which remained unchanged as of 4 August 2023.
At this stage, there has been no comment from the Coinbase camp, but experts believe a strong Q2 motivated the gesture. For this period, the company reported revenues of $708m and an adjusted earnings-per-share loss of $0.42. This trumped analyst predictions of $628m in revenue and an adjusted earnings-per-share loss of $0.76. Despite a drop in revenue achieved in 2022, Coinbase clawed itself back from a crippling $4.98 earnings-per-share loss recorded during the same period last year.
