IREN Limited (IREN) stock declined 4.2% in after-hours trading on Tuesday after the Bitcoin miner announced a $875 million private offering of convertible senior notes due 2031. The offer is aimed at qualified institutional buyers. With the move, IREN aims to bolster its financial flexibility as it expands its footprint in AI infrastructure and Bitcoin mining.
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The offering can increase to $1 billion if initial purchasers exercise their option for an additional $125 million within 13 days of the initial issuance.
Also, the notes are senior, unsecured obligations, with interest paid semi-annually and a maturity date of July 1, 2031. Investors can choose to convert them into cash, shares, or both, depending on certain terms.
It must be noted that IREN can choose to redeem the notes, starting on January 8, 2029, but only if the company’s share price is above 130% of the conversion price for a specified period.
Importantly, the company plans to use a portion of the net proceeds to fund capped call transactions, which are typically used to mitigate dilution risk. The remaining funds will be allocated for general corporate purposes and working capital, pointing to IREN’s aim to scale operations amid rising demand for AI compute and digital infrastructure.
Is IREN a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on IREN stock based on eight Buys, three Holds, and one Sell assigned in the past three months. Further, the average IREN price target of $47.30 per share implies 23.31% downside risk.
