IREN (NASDAQ: IREN) priced a $2 billion convertible senior notes offering and a $1.63 billion equity offering on Wednesday.
The company intends to use the fundraised capital primarily to repurchase existing convertible notes, fund capped call transactions, and support general corporate purposes.
The debt offering consists of $1 billion in 0.25% convertible senior notes due 2032 and $1 billion in 1.00% convertible senior notes due 2033. The initial conversion rate for both series is 19.46 ordinary shares per $1,000 principal amount of notes.
This works out to $51.39 per share, representing a premium of approximately 25% over the last reported sale price of $41.12 per share on December 2.
IREN’s net proceeds under the offering could increase to approximately $2.27 billion if the initial purchasers exercise their options to acquire an additional $150 million in notes for each series.
IREN also concurrently priced an equity offering of $1.63 billion to repurchase approximately $227.7 million in notes due 2030 and $316.6 million in notes due 2029. The offering consists of 39.7 million ordinary shares at $41.12 per share.
The company plans to allocate $174.8 million of the net proceeds to enter into capped call transactions.
These agreements cover the number of shares underlying the notes in an effort reduce potential dilution to ordinary shares upon conversion. The cap price for these transactions is $82.24 per share, representing a 100% premium over the December 2 closing price.
The repurchase of existing debt involves the 3.25% convertible senior notes due 2030 and the 3.50% convertible senior notes due 2029.
Once repurchased, these existing notes will be extinguished and no longer convertible into ordinary shares. IREN indicated that the completion of the notes offering is not contingent on the completion of the equity offering or the debt repurchase.
