Bitfarms has increased its convertible senior notes offering from $300 million to $500 million, citing strong market demand and growth plans in AI and computing.
Summary
- Bitfarms increased its convertible note offering to $500M amid high investor demand.
- Notes carry a 1.375% rate and include capped calls to offset dilution.
- Funds will support AI and HPC expansion as the firm diversifies beyond mining.
Bitfarms is expanding its latest funding round as investor interest grows, marking another major step in its evolving digital infrastructure strategy.
According to an Oct. 16 press release, the company priced its offering of $500 million in 1.375% convertible senior notes due 2031, up from an initial $300 million announced a day earlier. The deal also includes a $88 million purchase option for initial buyers, with closing expected around Oct. 21, subject to Toronto Stock Exchange approval.
Details of Bitfarms’ offering
The notes, which mature on Jan. 15, 2031, will accrue interest at 1.375% annually, payable twice a year. They are senior unsecured obligations and may be redeemed, repurchased, or converted under specific conditions. The initial conversion price is set at approximately $6.86 per share, a 30% premium over Bitfarms’ Oct. 16 Nasdaq closing price of $5.28.
Bitfarms will also enter into capped call transactions to mitigate potential dilution from note conversions. These privately negotiated arrangements cover the number of shares underlying the notes, with a cap price of $11.88 per share, representing a 125% premium over the company’s latest market price. The company intends to fund these capped calls using proceeds from the offering or existing cash on hand.
Proceeds will be used for general corporate purposes and to support Bitfarms’ capital expansion in artificial intelligence and high-performance computing.
Strategic context and market impact
Convertible note offerings have grown in popularity among mining companies looking for non-dilutive funding for capital-intensive expansion.
Investor trust in Bitfarms’ changing approach is demonstrated by the decision to increase the offering. Due to its shift from traditional Bitcoin mining to AI and HPC infrastructure, the company’s stock has surged by more than 530% in just six months.
Recent developments include a $300 million Macquarie debt facility for its Panther Creek site, new partnerships in AI data centers, and second-quarter revenue growth of 87% year-over-year to $78 million. Analysts maintain a consensus “Buy” rating, with expectations of profitability in 2025.
