TLDR
- Bitfarms upsizes its convertible notes offering to $500 million, up from $300M.
- The offering includes 1.375% senior notes due in 2031 with a 30% premium.
- Proceeds will be used for corporate purposes and capped call transactions.
- Bitfarms’ stock fell 18.4% on the announcement, despite recent gains.
Bitcoin mining company Bitfarms has announced an expanded offering of convertible senior notes, increasing the size to $500 million, up from $300 million just one day prior. The move comes as the company seeks to raise significant funds to support its ongoing business activities. The offering, which includes a premium conversion price, aims to bolster Bitfarms’ financial position and minimize potential shareholder dilution.
Increased Offering Size and Terms
Bitfarms, listed on both the Nasdaq and Toronto Stock Exchange, revealed that the offering will include 1.375% convertible senior notes, maturing in 2031. This expansion follows the company’s earlier announcement of a $300 million offering. As part of the offering, Bitfarms will allow initial purchasers to buy an additional $88 million of the notes within 13 days of the closing.
The convertible notes will accrue interest on a semi-annual basis, beginning on July 15, 2026, and will mature on January 15, 2031. The initial conversion price of these notes is set at approximately $6.86 per share, which represents a 30% premium over Bitfarms’ last closing price of $5.28. This price is intended to provide a cushion to existing shareholders by setting a higher conversion price.
Proceeds and Use of Funds
Bitfarms intends to use the proceeds from the offering for general corporate purposes. This could include a range of activities such as debt repayment, infrastructure expansion, or operational improvements. Additionally, part of the funds will be directed towards financing capped call transactions, designed to minimize the potential dilution of shareholder equity.
Capped call transactions are a common strategy used by companies issuing convertible notes to limit the impact of potential share dilution. This means that the company will ensure that, even if the convertible notes are converted to shares, the overall dilution will be capped within a certain rang