Bitcoin miner-turned-AI factory IREN (Nasdaq: IREN) closed a $2.3 billion offering of convertible senior notes and completed the repurchase of $544.3 million in existing debt as of Monday. The news was announced after markets closed December 8.
The Australian data center company finalized the transaction following the full exercise of a $300 million option by initial purchasers.
The offering consisted of $1.0 billion in 0.25% convertible senior notes due 2032 and $1.0 billion in 1.00% convertible senior notes due 2033. Initial purchasers exercised their option to buy an additional $150 million principal amount of each notes.
The company also repurchased a portion of its outstanding convertible notes following its $1.63 billion capital raise from issuing 39.7 million ordinary shares.
IREN bought back $316.6 million aggregate principal amount of its 3.50% convertible senior notes due 2029. The company also repurchased $227.7 million aggregate principal amount of its 3.25% convertible senior notes due 2030.
The 2029 notes carried a conversion price of $13.64 per share. The 2030 notes held a conversion price of $16.81 per share. IREN structured the transaction to lower average annualized cash coupons and extend maturities on its debt profile.
IREN utilized $201.0 million of the net proceeds to enter into capped call transactions. These agreements serve as a hedge to minimize potential dilution to ordinary shares upon conversion of the new notes. The capped calls cover the number of shares underlying the notes up to an initial cap price of $82.24 per share.
Investors in the new notes do not hold a put option. The terms include a customary put right applicable only in the case of certain fundamental changes to the business. The capped call transactions mitigate dilution risks unless the share price exceeds the cap level.
The convertible notes and equity offerings combined raised some $2.27 billion.The final closing follows the pricing of the offering announced last week.
