TLDR
- CleanSpark expanded its zero-coupon convertible bond offering to $1.15 billion, maturing in 2032, after receiving higher than expected investor demand
- The company will use $460 million to repurchase shares at $15.03 per share
- Remaining funds will support energy capacity expansion, land acquisition, data center development, and repayment of bitcoin-backed credit lines
- The bonds carry a 27.5% conversion premium with an optional $200 million additional purchase available to initial buyers
- CleanSpark shares dropped 5% in pre-market trading to around $14 per share
CleanSpark announced on Monday its plan to offer $1.15 billion in convertible senior notes to qualified institutional buyers. The notes will mature on February 15, 2032.
The company initially planned a smaller offering but increased the size after receiving stronger than expected demand from investors. Initial purchasers received an option to buy up to an additional $200 million in securities within 13 days of issuance.
The notes are senior unsecured obligations of the company. They will not bear regular interest and the principal amount will not accrete.
CleanSpark plans to allocate approximately $460 million of the proceeds to repurchase shares of its common stock at $15.03 each. The buyback will target investors participating in the offering.
The remaining funds will go toward several growth initiatives. These include expanding the company’s power and land portfolio, developing data center infrastructure, and repaying bitcoin-backed lines of credit.
The convertible notes come with a 27.5% conversion premium. Investors will have the option to convert the notes into cash, CleanSpark common stock, or a combination of both at the company’s discretion.
The offering is expected to close on November 13. Final terms remain subject to market conditions and negotiations with initial purchasers.
Share Price Reaction
CleanSpark shares fell 5% in pre-market trading following the announcement, trading around $14 per share. The decline is attributed to delta-hedging strategies employed by the banks involved in the placement.
This technical adjustment is common in convertible note offerings. Banks typically hedge their exposure by selling shares in the open market.
Mining and AI Convergence
CleanSpark is following a financing strategy recently used by other companies in the space. TeraWulf and Galaxy Digital both tapped the convertible market to fund expansion projects.
The company is positioning itself at the intersection of bitcoin mining and artificial intelligence infrastructure. It aims to build a hybrid model where data centers support both bitcoin mining and high-performance computing applications.
Last month, CleanSpark hired Jeffrey Thomas as senior vice president of AI Data Centers. The move signals the company’s commitment to expanding beyond traditional mining operations.
Georgia has been marked as a strategic region for this expansion. CleanSpark already holds real estate and power assets in the state.
This represents the company’s second major convertible note issuance in less than a year. CleanSpark raised $650 million through a convertible note due in 2030 in December 2024.
Bitcoin miners have been pivoting toward high-performance computing services. Revenue from traditional mining has declined, making diversification into AI infrastructure more attractive.
The convertible debt structure allows companies to raise capital without immediate share dilution. This preserves exposure to growth markets while maintaining financial flexibility.
CleanSpark’s latest offering reflects growing demand for energy and computing capacity. Both bitcoin mining and AI workloads require substantial infrastructure investment.
The company continues to expand its footprint in both sectors. The dual focus aligns revenue streams with parallel growth in blockchain and artificial intelligence industries.
The offering remains subject to final market conditions and purchaser negotiations.
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