FRMI · Fermi Inc. Common Stock

Fermi Inc. executed a capital raise through a convertible senior notes offering, upsized to $431.25 million due to strong demand. The 5.00% coupon is attractive given the five-year term, and the conversion premium of 30% provides upside potential for noteholders while limiting immediate dilution. The concurrently entered capped call transactions, costing $34.5 million, effectively raise the conversion price to $14.64 per share, meaning no dilution occurs unless the stock price doubles from the $7.32 closing price on July 9, 2026. Even at higher stock prices, dilution is capped. The net proceeds of ~$416.81 million bolster the company's liquidity as it advances Project Matador, a large-scale AI and energy campus. The press release emphasizes that the flexible structure and low cost of capital strengthen Fermi's negotiating position with tenants and partners. The notes are unsecured and rank equally with existing and future unsecured indebtedness. Overall, this financing provides significant run room without immediate equity dilution, aligning with the company's development timeline.