Ramaco Resources prices $300 million convertible notes offering

Ramaco Resources Inc. (NASDAQ: METC) announced the pricing of its public offering of $300 million in convertible senior notes due 2031. The notes carry a 0% interest rate and are scheduled to settle on November 7, 2025.

The company granted underwriters an option to purchase an additional $45 million in notes to cover over-allotments. Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC serve as book-running managers for the offering.

Ramaco estimates net proceeds of approximately $290.9 million after deducting underwriting discounts and estimated offering expenses. If underwriters fully exercise their over-allotment option, net proceeds would reach approximately $334.7 million.

The company plans to use approximately $28.5 million of the proceeds to fund capped call transactions. The remaining funds will support development of its rare earth elements and critical minerals project, strategic growth opportunities, and general corporate purposes.

The notes have an initial conversion rate of 30.5460 shares of Class A common stock per $1,000 principal amount, representing a conversion price of approximately $32.74 per share. This reflects a 35% premium over the $24.25 public offering price per share in a concurrent stock offering.

Noteholders can convert their notes only under certain circumstances before August 1, 2031, after which conversion rights become unrestricted until maturity. Ramaco may redeem the notes starting November 6, 2028, if the stock price exceeds 130% of the conversion price for a specified period.

In connection with the note pricing, Ramaco entered into capped call transactions with financial institutions. These transactions have a cap price of approximately $54.56 per share, representing a 125% premium over the concurrent stock offering price.

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