Iren (IREN), a Bitcoin mining company, is aiming to secure up to $2.3 billion through a convertible note issuance to address existing debt as hashprice drops to a five-year low, impacting revenue.
The firm is planning to issue $1 billion in convertible senior notes due 2032 and another $1 billion due 2033 in a private placement intended for institutional investors. Buyers may opt for an additional $150 million from each series, the company announced. Additionally, it intends to sell shares to finance a buyback of certain 2029 and 2030 convertible notes.
The company’s stock fell 5% to around $45 during Tuesday’s trading and is over 40% below its peak from November. This decline likely reflects delta hedging from banks involved in the transaction, a temporary phenomenon also observed with other miners issuing convertibles.
Hashprice indicates the expected daily value of one terahash per second of computing power. It demonstrates how much revenue a miner can anticipate from a certain hashrate, increasing with Bitcoin’s price and fee volume, while decreasing as mining difficulty heightens. It reached a five-year low last month.
The final conditions of the debt issuance, including the coupon and conversion premium, will be determined at pricing. This structure resembles the zero-coupon convertible issued in October, indicating the company’s aim for lower-cost financing in comparison to the 3.25% and 3.50% coupons on the notes it plans to retire. Capped call transactions are also planned to mitigate dilution, as stated in the announcement.
