Crypto Mining Firm TeraWulf Announces $350 Million Convertible Senior Notes Offering

Maryland-headquartered Bitcoin mining firm TeraWulf has announced plans to offer $350 million in convertible senior notes due 2030. This private placement is targeted at qualified institutional buyers, subject to market conditions.

In a press release dated Oct. 23, TeraWulf revealed that the offering might include an additional $75 million if initial purchasers exercise their option within a 13-day window post-issuance. The proceeds from this offering are intended for several corporate purposes, including the cost of capped call transactions, repurchasing shares of the company’s common stock, and general corporate needs.

Convertible Senior Notes Details

These senior unsecured obligations will accrue interest payable semi-annually starting May 1, 2025, with a maturity date set for Feb. 1, 2030. The notes are convertible into cash or a combination of cash and common stock.

Hedging Activities and Market Impact

TeraWulf plans to engage in privately negotiated capped call transactions to mitigate potential dilution from conversions. These hedging activities could influence the stock price during the offering period, affecting the market for both the convertible notes and common stock.

It is crucial to note that the convertible notes and any related shares of common stock are not registered under the Securities Act and can only be offered to qualified institutional buyers.

Financial Performance and Future Plans

In early August, TeraWulf reported its Q2 financial results, highlighting a 130% increase in revenue year-over-year despite a decline in Bitcoin production. The firm’s self-mined Bitcoin in Q2 decreased by 21.4%, totaling 699 BTC across its Lake Mariner and Nautilus Cryptomine facilities. This decline was attributed to increased mining difficulty and elevated power costs.

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