Bitcoin miner TeraWulf seeks $350m in convertible notes for stock buybacks

Crypto mining firm TeraWulf plans to offer $350 million of convertible senior notes by 2030 to qualified institutional buyers with the proceeds intended for institutional purposes.

Maryland-based Bitcoin (BTC) mining company TeraWulf has announced its intention to offer $350 million of convertible senior notes due 2030 in a private placement targeting qualified institutional buyers, subject to market conditions.

In a press release on Wednesday, October 23, the firm said the offering could include an additional $75 million if initial buyers exercise the option within 13 days of issuance. The company plans to use the proceeds “to pay the cost of the captive transactions, to repurchase the company’s common stock, and for general corporate purposes.”

These senior unsecured obligations will accrue interest, payable semi-annually, beginning May 1, 2025, with a maturity date of February 1, 2030, the press release said. The bonds can be converted into cash or a combination of cash and common currency, the press release states.

TeraWulf intends to participate in privately negotiated limited call transactions to reduce potential attrition from conversions. TeraWulf noted that these hedging activities could impact the stock price during the offering period and impact the market for both the convertible bond and common stock.

The convertible notes and related common shares are not registered under the Securities Act and are only available to qualified institutional buyers, the firm added.

In early August, TeraWulf announced second-quarter financial results, showing a 130% year-over-year increase in revenue despite a decline in Bitcoin production. The amount of Bitcoin self-mined by the company decreased by 21.4% in the second quarter, reaching a total of 699 BTC at the Lake Mariner and Nautilus Cryptomine facilities. The company attributed this to increasing mining difficulty and rising energy costs.