In a significant move, IREN has awarded its co-CEOs, Daniel and William Roberts, a massive package of 18.2 million restricted stock units, valued at approximately $700 million. This grant, which constitutes about 5% of the company’s total stock, is designed to remain locked up until fiscal 2033, aligning with the company’s strategic decisions as it transitions to artificial intelligence (AI) from its roots in Bitcoin mining.
The stock units were approved by the board on June 30, with each brother receiving a total of 9,099,328 units. These units will vest gradually over the next four years, but there are restrictions in place; each tranche is subject to a two-year sale ban, meaning that the final shares will only become available for trading in fiscal 2033. Additionally, neither executive is permitted to receive any new equity grants until fiscal 2031, a stipulation that adds an extra layer of commitment to their leadership positions.
This timing of this grant is notable, as IREN publicly traded on Nasdaq since 2021. The Roberts brothers, both former Macquarie bankers who founded IREN in 2018, maintain significant control over the company, with each holding a B Class share that affords them 15 votes per ordinary share. This structure has allowed them to retain a substantial influence: while they held only 2.3% of the equity in August, they commanded approximately 21.8% of the voting power, giving them almost 44% of the overall voting rights.
However, the company is facing scrutiny as the rights associated with their dual-class shares are set to expire around November 2033. Institutional investors have begun to advocate for dual-class systems with a sunset period of seven years or fewer, a sentiment reflecting growing concerns about governance and long-term control.
The recent equity grant comes at a time of significant operational changes for IREN, as the company pivots from Bitcoin mining to focus more on AI compute capabilities. This strategic shift has led to a notable increase in the share count, rising from approximately 272 million in August to 341 million by March, which could dilute the Roberts’ voting power.
In reaction to the stock award announcement, IREN’s share price dropped roughly 10% to $38.82 shortly thereafter, highlighting the market’s mixed feelings regarding the large equity grant. Short seller Jim Chanos remarked on the substantial nature of the award, likening it to 17% of IREN’s projected cumulative adjusted net income from fiscal 2027 through 2030. This has raised questions about whether the grant aligns with performance metrics or simply rewards time served.
In response to concerns, the IREN board characterized the equity grant as part of a long-term incentive plan aimed at retaining the co-CEOs during a crucial phase of growth. They expressed that the equity awards were intended to align the interests of the executives with the company’s objectives moving forward.
As IREN navigates its transformation from mining to AI and the potential effects of their leadership structures, the actual impact of this significant stock grant will unfold in the coming years, shaping both the company’s direction and governance.
