Bitcoin miner Cipher upsizes private offering to $1.1 billion following Google-backed AI hosting deal

Bitcoin miner and AI hosting firm Cipher Mining has upsized its planned private offering of convertible senior notes to $1.1 billion from the $800 million it had announced earlier on Thursday.

According to a statement, the notes, due in 2031, will not bear regular interest and are convertible into shares, cash, or a mix of the two under certain conditions. Cipher also granted the initial purchasers a 13-day option to buy up to an additional $200 million in notes. The offering is limited to qualified institutional buyers.

Cipher estimates net proceeds of approximately $1.08 billion from the offering, or $1.27 billion if the full option is exercised, after discounts and commissions but before expenses.

Among other corporate purposes, Cipher intends to use the proceeds to help fund its Barber Lake facility in Texas, where it recently signed a 10-year, $3 billion hosting deal with AI cloud infrastructure firm Fluidstack. As part of that arrangement, Google agreed to backstop $1.4 billion of Fluidstack’s lease obligations and secured warrants equal to a 5.4% equity stake in Cipher.

The Barber Lake site will initially deliver 168 megawatts of critical IT load capacity under the agreement, with options for two five-year renewals that could raise its total value to about $7 billion.

“We are thrilled to be working with Fluidstack to develop HPC data centers, and we look forward to welcoming Google as an investor in Cipher. This transformative transaction reinforces our HPC momentum as we continue to attract attention for our large and growing pipeline of sites,” Cipher CEO Tyler Page said at the time.

Cipher is the fifth-largest public bitcoin miner by market cap. Its shares initially surged more than 20% in pre-market trading on Thursday following the deal, but later slumped 17.5% by the day’s close amid a broad market selloff, according to The Block’s Cipher Mining price page.