Riot Convertible Notes Worth $500M Offered to Strength Copany’s Mining Strategy

Key Points:

• Riot convertible notes are being offered with maturity in 2030, with an additional $75 million option for buyers.
• The funds may be used for strategic acquisitions, including Bitcoin purchases.

Riot Platforms, a leading Bitcoin mining and digital infrastructure company, announced that it intends to offer $500 million aggregate principal amount of its convertible senior notes due 2030.

Read more: Bitfarms Riot Settlement Passed After Tense Disputes

Riot Convertible Notes Offered to Strengthen Position in Bitcoin Mining

The offering of the Riot convertible notes to qualified institutional buyers would strengthen Riot’s financial position and mirror strategies employed by other industry giants.

The notes represent unsecured senior debt and will mature on January 15, 2030, unless earlier repurchased, redeemed, or converted in accordance with their terms. Riot may redeem the notes for cash in whole or in part at any time commencing on January 20, 2028.

In addition, the Riot convertible notes can be converted into cash, common stock of Riot, or a combination of both, at the option of the company. Prior to June 15, 2029, conversion is permitted only upon the occurrence of certain events and during certain periods but will be open thereafter until shortly before maturity.

Riot Adjusts for Crypto Market Turbulences by Adopting Strategic Financing

Along with this offering, Riot may also allow initial purchasers to buy an additional $75 million of notes. The proceeds could provide leeway for the company to buy Bitcoin directly from the open market, as has happened previously with MicroStrategy, another large holder of Bitcoin.

Riot operates Bitcoin mining facilities in Texas and Kentucky and manufactures electrical equipment in Denver, Colorado. This bond sale comes during a very difficult time for Bitcoin mining companies, most of which have had a terrible time during the prolonged bear market.

Shrinking profit margins in 2022-2023 led to significant restructuring across the sector, with Core Scientific filing for bankruptcy and Argo Blockchain narrowly avoiding a similar fate.