Fri, Oct 16, 2026
Cipher Digital closes $850 million convertible notes offering
Analysis
Mixed-to-neutral: this is a refinancing-style transaction that extends Cipher Digital's debt maturity profile by issuing $850 million of zero-coupon notes due 2032 while retiring most of its 2030 notes via a ~40.7 million share equity exchange, trading modest shareholder dilution for reduced near-term refinancing risk. Capped call transactions (cap price $28.35) partially offset conversion dilution, and the zero coupon keeps near-term cash interest costs low.
Key points
- Cipher Digital issued $850.0 million of 0.00% convertible senior notes due 2032, with initial purchasers holding a 13-day option for an additional $150 million.
- Notes carry an initial conversion price of about $15.31 per share (65.3211 shares per $1,000 principal) and mature November 1, 2032.
- The company entered capped call transactions with a cap price of $28.35 (a 150% premium to the October 13, 2026 closing price), costing about $89.7 million, to reduce potential dilution.
- Concurrently, the company exchanged about $165.9 million of its existing 1.75% convertible senior notes due 2030 for about 40.7 million shares of common stock, leaving about $6.6 million of 2030 notes outstanding.
- The company also elected physical settlement as the default settlement method for its remaining 2030 notes and its 0.00% convertible senior notes due 2031.