Keel Infrastructure Corp. Announces Proposed \$350 Million Convertible Senior Notes Offering
Key Highlights of the Announcement
- Offering Size: Keel Infrastructure Corp. intends to offer \$350 million aggregate principal amount of convertible senior notes due 2032.
- Additional Option: Initial purchasers will have a 13-day option to purchase up to an additional \$58 million of notes, potentially raising the total offering to \$408 million.
- Guarantee: The notes are fully and unconditionally guaranteed on a senior unsecured basis by Bitfarms Ltd., a wholly owned subsidiary of Keel.
- Interest and Maturity: Notes will accrue interest payable semi-annually, starting January 15, 2027, and mature on January 15, 2032.
- Conversion Features: Convertible into cash, Keel common stock, or a combination, at Keel’s election. Conversion terms, rates, and interest will be set at pricing.
- Market Conditions: Completion of the offering is subject to market and other conditions, with no guarantee of timing or terms.
Strategic Use of Proceeds
- A portion of proceeds will fund “capped call” transactions, which are designed to reduce potential dilution upon conversion of notes.
- Remaining proceeds will be used for general corporate purposes, including funding deposits for long-lead equipment and collateralizing letters of credit for data center development.
- If additional notes are sold, proceeds will similarly fund capped call transactions and general corporate purposes.
Details on Capped Call Transactions
Keel plans to enter into privately negotiated capped call transactions with initial purchasers, their affiliates, or other financial institutions. These transactions will cover the number of shares underlying the convertible notes, subject to anti-dilution adjustments. If additional notes are issued, more capped call transactions will be entered into.
The capped call is expected to offset dilution and/or cash payments required above principal amount on conversion, with the cap targeted at a 100% premium to Keel’s last reported sale price at the time of pricing.
Capped call counterparties may hedge by purchasing Keel stock or entering derivatives, potentially affecting the stock price during and after pricing, and especially during conversion periods or if capped call transactions are terminated.
Regulatory and Offering Details
- The notes and stock issuable upon conversion will not be registered under U.S. or Canadian securities laws, and will be offered only to “qualified institutional buyers” and via prospectus exemptions in Canada.
- The offering is subject to approvals from Nasdaq and the Toronto Stock Exchange. Shares issued upon conversion will have a statutory hold period.
- Keel will rely on TSX’s exemption for Eligible Interlisted Issuers for this offering.
- This press release is not an offer or solicitation to buy or sell securities in any jurisdiction where it would be unlawful.
Corporate Background and Recent Developments
Keel Infrastructure is a North American digital and energy infrastructure company, specializing in data centers and energy infrastructure for high-performance computing (HPC) and AI workloads. The company boasts a pipeline of 2.2 gigawatts and established grid interconnections in Pennsylvania and Washington (U.S.), and Québec (Canada).
On April 1, 2026, Keel became the ultimate parent of Bitfarms Ltd. through a statutory arrangement, part of Bitfarms’ redomiciliation from Canada to the U.S. and rebranding as Keel. Bitfarms shareholders received one Keel share for each Bitfarms share.
Forward-Looking Statements and Risks
Keel warns that the offering, capped call transactions, and use of proceeds involve forward-looking statements subject to risks and uncertainties. The company’s transformation from Bitcoin mining to HPC infrastructure may not succeed. Key risks include:
- Limited operating history and prior losses.
- Dependence on regulated electricity rates and supply chains.
- Development delays, cost overruns, and competition from HPC and Bitcoin mining operators.
- Potential inadequacy of insurance coverage.
- Profitability risk in new HPC/AI markets.
- Capital intensity and possible inability to secure financing.
- Site competition and regulatory constraints.
- Customer concentration and risk of defaults.
- Rapidly evolving regulations in HPC, AI, and cryptocurrency.
- Bitcoin price volatility and halving events impacting mining rewards.
- Reliance on a single mining pool operator; risk from crypto exchanges and custodians.
- Permitting, environmental, and climate-related regulatory costs.
- Political and regulatory uncertainty, cybersecurity threats, and future capital needs.
- Hedging effectiveness and counterparty risk for capped call transactions.
- Potential shareholder dilution from future stock issuances, note conversions, options and warrants.
- Risks related to U.S. redomiciliation, including failure to realize anticipated benefits.
Keel cautions investors not to place undue reliance on forward-looking statements. Actual results could differ materially from expectations.
Investor and Media Contacts
- Investor Relations: Laine Yonker ([email protected])
- Media Contact: Tara Goldstein ([email protected])
Disclaimer: This article is based on information provided by Keel Infrastructure Corp. and is intended for informational purposes only. It does not constitute financial advice or a solicitation to buy or sell securities. The offering described is subject to market conditions and regulatory approval, and actual outcomes may differ materially from those anticipated. Investors should review official filings and consult with professional advisors before making investment decisions. Trading in Keel securities should be considered highly speculative.
