Cipher Digital Prices $850 Million Convertible Notes Offering
Cipher Digital Inc. (CIFR) has priced a $850 million private offering of zero-coupon convertible senior notes maturing in November 2032. Initial buyers in the transaction receive a 13-day option to purchase up to an additional $150 million of notes. In tandem with the debt issuance, the company expects to exchange roughly $165.9 million of its 1.75% notes maturing in 2030 for approximately 40.7 million common shares in negotiated transactions.
The new 2032 notes carry an initial conversion rate equivalent to $15.31 per share, representing a 35% premium over the October 13 closing stock price of $11.34. Cipher estimates net proceeds from the offering will reach approximately $835.1 million, or $982.5 million if initial purchasers fully exercise their option. Proceeds are slated to fund Barber Lake equity, high-performance computing infrastructure, project development, and capped call transactions.
Investors will be watching the completion of the debt exchange and the potential exercise of the over-allotment option. Shares of Cipher Digital Inc. traded down 12.77% to $11.34 following the announcement.
Key points
- Cipher Digital Inc. priced $850 million of 0.00% convertible senior notes due 2032 in a private placement.
- Initial purchasers have a 13-day option to buy up to $150 million in additional notes.
- The company expects to exchange $165.9 million of 2030 notes for about 40.7 million common shares.
- The initial conversion price of ~$15.31 per share is a 35% premium over the October 13 closing price.
- Net proceeds of ~$835.1 million will support computing infrastructure, development, and capped calls.
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What are the terms of Cipher Digital's convertible note offering?
Cipher Digital priced $850 million of 0% convertible senior notes due 2032 with an initial conversion price of about $15.31 per share. Initial buyers also have an option to purchase up to $150 million in additional notes.
How will Cipher Digital use the proceeds from the note offering?
The net proceeds of approximately $835.1 million are earmarked for Barber Lake equity, high-performance computing infrastructure build-out, project pipeline development, and capped call transactions.
What is Cipher Digital doing with its 2030 notes?
Cipher Digital expects to exchange about $165.9 million principal amount of its 1.75% notes due 2030 for approximately 40.7 million shares of common stock in negotiated transactions.