TechFlow news: Cryptocurrency exchange Coinbase previously announced a $150 million face-value repurchase of its corporate bonds, but so far the amount tendered for repurchase has been limited, with investors generally optimistic about the outlook for Coinbase's bonds.
On Monday, Coinbase raised the repurchase price to 67.5% of face value, yet only $50 million face value of bonds were tendered. The outstanding bonds, which mature in 2031 and carry a coupon rate of 3.625%, are currently trading at approximately 63.5% of face value. Bondholders may still decide whether to accept the offer until September 1.
Earlier this month, Coinbase first announced a plan to repurchase up to $10 billion in bonds. Prior to the initial announcement, these bonds had briefly traded below 60% of face value. Although Coinbase continues to face regulatory challenges, its most recent quarterly earnings surpassed analysts' expectations. The company's stock has declined nearly 29% over the past month but remains up more than 100% year-to-date.
Coinbase is currently facing a lawsuit from the U.S. Securities and Exchange Commission, prompting Moody's to downgrade the company's rating outlook in June. However, strong investor confidence in the creditworthiness of Coinbase's bonds appears to be the reason behind the lukewarm response to the company's repurchase offer.
