Bitfarms upsizes $500M convertible notes; shares tumble
Bitcoin mining firm Bitfarms has increased its convertible notes offering from an initial $300 million to $500 million, issuing 1.375% notes due January 15, 2031. The notes convert at roughly a 30% premium to the last close and include an $88 million overallotment option. To curb dilution, Bitfarms entered capped call transactions with a strike price of $11.88 (125% premium). Proceeds will fund general corporate needs and expansion into AI and high-performance computing. After the announcement, Bitfarms shares plunged 18.4% in regular trading and fell another 5.3% in after-hours, closing at $5.28, despite an 82.7% gain over the past month and a 530% rally across six months. The issuance, pending TSX approval, is set to close by October 21, 2025. Bitfarms operates 1.3 GW of energy infrastructure across North American mining and HPC centers and recently secured a $300 million Macquarie debt facility, posted Q2 revenue up 87% year-over-year to $78 million, and unveiled new AI data center partnerships. Analysts maintain a unanimous “Buy” rating, forecasting profitability by 2025.
Neutral
While the convertible notes offering and capped calls triggered a sharp sell-off in Bitfarms equity due to dilution concerns, the move is primarily a corporate financing event with minimal direct impact on Bitcoin’s market price. In the short term, equity dilution fears weighed on trader sentiment, but the funding facilitates capacity expansion into AI and high-performance computing, which could support mining operations long term. Overall, the announcement is unlikely to significantly sway Bitcoin’s price, making the net impact neutral.