Wed, Oct 14, 2026
Cipher prices $850M convertible notes due 2032, exchanges 2030 notes
Analysis
Positive: Cipher locked in an $850M zero-coupon convertible raise at a 35% conversion premium, extending its maturity profile out to 2032 while funding capped calls to limit dilution and advancing the Barber Lake buildout; the concurrent exchange of $165.9M of 2030 notes for ~40.7M shares pushes near-term refinancing risk out further at the cost of modest share dilution.
Key points
- Cipher Digital priced $850.0 million of 0.00% convertible senior notes due 2032 in a Rule 144A private offering, settling October 16, 2026.
- Initial purchasers have a 13-day option for up to $150.0 million more notes.
- Initial conversion price is about $15.31/share (65.3211 shares per $1,000), a 35.0% premium over the October 13, 2026 close of $11.34.
- Notes are redeemable by Cipher on/after November 5, 2029 under share-price conditions; holders may put on November 1, 2030 or on a fundamental change.
- Estimated net proceeds of approximately $835.1 million (up to ~$982.5 million with the option exercised) will fund capped call transactions (~$89.7 million), an additional equity investment in the Barber Lake project, HPC pipeline build-out, development-site pipeline expansion, and general corporate purposes.
- Concurrently, Cipher expects to exchange approximately $165.9 million principal of its 1.75% convertible senior notes due 2030 for about 40.7 million shares of common stock in privately negotiated transactions.
- Cipher also entered into capped call transactions with a cap price of $28.35/share (150% premium) to reduce potential dilution from note conversions.