Key Highlights:
- Cipher Mining is upsizing its private offering of 0.00% convertible notes from $800 million to $1.1 billion, indicating a strong investor interest.
- The notes carry a conversion price of $16.03 per share which is about 37.5% above the last trade which was at $11.66. This offers investors flexible settlement in cash, stock or both.
- Cipher will use $1.08 billion to expand its data centres, HPC projects and limit stock dilutions.
Cipher Mining Inc. (NASDAQ: CIFR), a leading developer and operator of large-scale industrial data centres, has completed the pricing of an increased private offering of $1.1 billion in 0.00% convertible senior notes which are due in 2031. The offering was initially set for $800 million but then the value was raised to satisfy strong investor demand. The deal is expected to close on September 30, 2025, after standard closing requirements are met.
Zero-Coupon, Unsecured Notes Explained
The convertible senior notes are a form of loan that Cipher Mining took from investors, with no interest, no collateral and provides the option for investors to turn it into stock before October 2031. As these notes do not carry regular interest, the principal will not increase over time. They can be converted into cash, common stock, or a mix of both, at Cipher’s choice.
The initial conversion rate is about 62.37 shares for each $1,000 principal amount, equal to a conversion price of roughly $16.03 per share. This price is about 37.5% higher than Cipher’s last reported stock price of $11.66 on September 25, 2025. The rate and price may change in normal cases such as stock splits or dividends before maturity.
Optional Upsizing and Redemption Terms
Cipher Mining is offering the initial purchasers a 13-day option where they can buy up to an extra $200 million in notes, which could raise total proceeds further. The offering also includes several features which will provide flexibility to both Cipher and the noteholders. Starting from October 5, 2028, the notes can be redeemed if Cipher’s stock price manages to stay about 130% of the conversion price for a set time.
Moreover, note holders can also ask Cipher to repurchase the notes during major corporate events or on October 1, 2029, at par value.
The company expects net proceeds of about $1.08 billion, or nearly $1.27 billion if the option is fully used, after deducting fees and commissions but before expenses. Roughly $70 million of these proceeds will be going toward capped call transactions, which are meant to limit any possible dilution from note conversions and reduce any extra cash payouts when the conversion occurs. The capped call deals include a cap price of $23.32 per share, which is about twice Cipher’s last trading price of $11.66.
Planned Use of Funds
The company is planning to spend the remaining funds on building its Barber Lake data centre, that will speed up its high-performance computing (HPC) plans across a 2.4 gigawatt pipeline. The company will also expand its development sites, and cover general corporate needs. If the initial purchasers buy the extra notes, Cipher will use part of those proceeds to add more capped call transactions.
As a part of its capped call hedge, Cipher is expecting its counterparties to carry out derivative trades and buy shares, which could affect the market price of Cipher’s stock and notes. This activity will likely continue around exercise dates and other key events that are linked to the notes.
Cipher Mining’s financial planning indicates that it is focused on growing data centre operations and HPC hosting, setting the stage for steady growth in Bitcoin mining and related high-performance computing markets. J. Wood Capital Advisors LLC acted as its financial advisor in this deal.
The larger convertible note offering gives Cipher Mining a flexible capital setup without regular interest costs, letting it use funds efficiently while still offering appealing terms to institutional investors in a competitive market.
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