Cipher Digital prices $810M notes as stock falls
Cipher Digital Inc. priced a $810 million offering of 6.000% senior secured notes due 2031 through a private placement expected to close on June 15, 2026. The notes, priced at 99.750% of principal, will finance the Stingray Facility and reimburse $61.5 million in prior equity contributions. The stock fell 7.75% to $21.25 amid the debt announcement and broader tech and crypto market weakness.
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Cipher Digital Inc. announced that its wholly-owned subsidiary, Stingray Compute LLC, has priced a $810.0 million offering of 6.000% senior secured notes due 2031. The notes are priced at 99.750% of their principal amount and will be sold in a private offering to qualified institutional buyers under Rule 144A and to non-U.S. persons under Regulation S. The offering is expected to close on June 15, 2026, subject to customary closing conditions.
The issuer intends to use the net proceeds to finance the remaining cost of the Stingray Facility, reimburse the company for approximately $61.5 million of prior equity contributions to Cipher Stingray LLC used for capital expenditures, and fund debt service reserves. The notes will be fully and unconditionally guaranteed by Cipher Stingray LLC and secured by first-priority liens on substantially all assets of the issuer and guarantor, as well as all equity interests of the issuer held by Cipher Stingray Holdings LLC.
Cipher Digital will provide a customary completion guarantee to ensure the timely completion of the Stingray Facility if the note proceeds are insufficient. The notes have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption.
Market Reaction and Context
Cipher Digital stock is under pressure as investors react to the debt pricing and a broader sell-off across technology and cryptocurrency-linked stocks. The tech-heavy Nasdaq is down 1.42%, while the S&P 500 has shed 0.96%. Weakness in the crypto market is also impacting sentiment; Bitcoin is trading at $62,126.93, down 5.64% over the past week, while Ethereum stands at $1,640.82, showing a 10.11% decline over the last 7 days.
Recent exchange data indicates that short interest in Cipher Digital decreased during the last reporting period, falling from 54.81 million to 52.53 million shares. This represents 15.67% of the company's publicly available shares short. With a recent average daily volume of 22.50 million shares, short sellers need 2.33 days to close out their positions. Cipher Digital shares were down 7.75% at $21.25 at the time of publication.
Financial Metrics
| Metric | Value |
|---|---|
| Offering Amount | $810.0 million |
| Coupon Rate | 6.000% |
| Maturity | 2031 |
| Price | 99.750% of principal |
| Reimbursement Amount | $61.5 million |
How will the completion guarantee impact Cipher Digital's liquidity if the Stingray Facility encounters cost overruns?
Will the 6.000% coupon rate put pressure on Cipher Digital's margins given the current high-interest-rate environment?
Could the decline in crypto-linked stocks affect the institutional demand for the $810 million private offering?
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