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Iris Energy (IREN) reveals more details about its $215m IPO

By Kevin Donovan

14:02, 11 November 2021

Iris Energy data centre
Iris Energy set a $25-$27 per-share range for its IPO - Photo: Iris Energy

Australian bitcoin miner Iris Energy announced price guidance for its planned initial offering of 8,269,231 million shares to the public in a US Securities and Exchange Commission filing.

The company announced a $25-$27 per-share range to raise roughly $215m. At the midpoint of the range, Iris Energy would have a $1.5bn (£1.11bn) valuation.

Iris Energy plans to use the proceeds from the offering to purchase additional bitcoin mining equipment, as well as fund its recent mining-operation expansion into British Columbia, Canada, where it is actively acquiring and building new bitcoin mining operations.

IPO details

JPMorgan, Canaccord Genuity and Citigroup are acting as joint lead bookrunners with Macquarie Capital, CLSA, Cowen and Cantor Fitzgerald also acting as bookrunners. Compass Point is acting as co-manager. Cryptocurrency asset manager Galaxy Digital Partners is acting as the digital asset adviser.

The underwriters are allocated the option to purchase an additional 1,240,384 million shares within 30 days of settlement at the IPO price. The settlement date is yet to be determined.

Iris Energy applied for listing over the Nasdaq exchange under the ticker IREN.

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Financials 

Beginning operations in 2019, Iris Energy lost $490.6m through the first three quarters of 2021 on $10.4m in revenue, compared with a $400,000 loss on $800,000 in revenue for the comparable period in 2020.

Iris Energy’s revenue and profitability are subject to changes in electricity prices as well as global currency exchange rates in relation to the price of bitcoin, the company noted.

Iris Energy estimates the annual bitcoin mining market at $16bn in 2021.

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Electricity needs

As a bitcoin mining concern, Iris Energy relies on low-cost electricity.

“We target entry into regions where there are low-cost, abundant and attractive renewable energy sources,” Iris Energy said.

Iris recently acquired a generation site located in British Columbia, Canada. The facility is supplied by the British Columbia Hydro and Power Authority and uses 98% clean or renewable generation sources, the company said. The data site has a 30-megawatt capacity.

Iris is contracted to purchase additional sites in British Columbia, which would increase its capacity up to 530 megawatts.

Tech specs

Iris Energy’s revenue derives from earning block rewards and other transaction fees, as well as exchanging bitcoin for fiat currency.

Iris uses specialised supercomputers called application specific integrated circuits (ASICs) for its mining operations.

The ASICs used in the mining operation are manufactured by Bitmain Technologies, which has contracted to supply Iris Energy with its hardware through September 2023. 

Read more: Australia’s Macquarie and Blockstream to explore green bitcoin mining

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