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Investing.com -- IREN Limited (NASDAQ:IREN) stock fell 7% in after-hours trading Monday after the company announced its intention to offer $2 billion in convertible senior notes through a private placement to qualified institutional buyers.
The proposed offering consists of $1 billion in convertible senior notes due 2032 and another $1 billion due 2033. IREN also plans to grant initial purchasers options to buy up to an additional $150 million of each note series within 13 days of issuance.
The notes will be senior, unsecured obligations with interest payable semi-annually. Noteholders will have conversion rights under certain circumstances, with IREN having the option to settle conversions in cash, ordinary shares, or a combination of both.
Concurrently, IREN announced plans for a registered direct offering of ordinary shares to fund the repurchase of a portion of its outstanding convertible notes due 2029 and 2030. The company expects the proceeds from this equity offering to approximately match the cash needed for these repurchases.
IREN intends to use the net proceeds from both offerings to fund capped call transactions, repurchase existing convertible notes, and for general corporate purposes. The capped call transactions are designed to reduce potential dilution to ordinary shares upon conversion of the new notes.
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