HIVE Digital Technologies Ltd (TSX:HIVE, NASDAQ:HIVE, FRA:YO0, BVC:HIVECO) has announced the pricing of an upsized private offering of $115 million in zero-coupon exchangeable senior notes due 2031, increasing the size of the deal from the previously announced $100 million.
The notes will be issued by HIVE Bermuda 2026 Ltd., a wholly owned subsidiary of HIVE, and are expected to close on June 30, subject to customary conditions. Initial purchasers have also been granted an option to buy up to an additional $15 million of notes within 13 days of issuance.
The notes will not pay regular interest and will mature on July 1, 2031, unless they are earlier exchanged, redeemed, or repurchased. They are exchangeable into cash, HIVE common shares, or a combination of both at the issuer's election. The initial exchange price is approximately $4.83 per share, representing a 27.5% premium to HIVE's Nasdaq closing price of $3.79 on June 25.
HIVE estimates net proceeds from the offering will total about $110 million, or roughly $124.5 million if the additional purchase option is exercised in full.
The company plans to use the funds for general corporate purposes, capital investments, including graphics processing unit (GPU) purchases, and data center development.
In connection with the offering, HIVE entered into cash-settled capped call transactions with certain financial institutions. The capped calls have an initial cap price of $8.53 per share, equal to a 125% premium over the June 25 closing price.
The company said the transactions are intended to reduce potential dilution from future exchanges of the notes and offset certain cash payments that could otherwise be required.
The notes are unsecured obligations of the issuer and are fully guaranteed by HIVE on a senior unsecured basis. Holders will have the right to require the issuer to repurchase their notes for cash on July 1, 2030, and under certain circumstances involving a fundamental change at the company.
The offering is being conducted as a private placement to qualified institutional buyers under Rule 144A of the US Securities Act.