Cryptocurrency mining large Bitfarms has entered a definitive merger settlement to accumulate Stronghold in a stock-for-stock merger transaction.
Canadian crypto miner Bitfarms is ready to accumulate its U.S.-based rival Stronghold Digital in a transaction valued at roughly $175 million, together with $125 million in fairness worth and $50 million in assumed debt.
In an Aug. 21 press launch, Bitfarms stated that buying Stronghold would carry important property, together with a 4.0 EH/s hashrate and 165 MW of energy capability as of June 2024. The corporate owns over 750 acres of land and two energy vegetation in Pennsylvania.
Regardless of the information, Bitfarms shares (BITF) plunged 7.2% to $2.19 in pre-market buying and selling, in accordance to Nasdaq knowledge.
The merger is anticipated to increase Bitfarms’ power portfolio, rising its capability to over 950 MW by the tip of 2025, with potential future expansions bringing whole capability to 1.6 GW. Bitfarms chief govt Ben Gagnon labeled the acquisition a transformative step, saying the corporate expects to have “visibility on multi-year expansion capacity up to 1.6 GW with approximately 66% in the U.S., up from approximately 6% today.”
“By vertically integrating with power generation, expanding our energy trading capabilities and securing two high potential sites for HPC/AI with significant multi-year expansion potential, we are executing our strategy to diversify beyond Bitcoin mining to create greater long-term shareholder value.”
Ben Gagnon, Bitfarms CEO
Bitfarms expands portfolio amid takeover makes an attempt
Bitfarms says the merger, which each corporations’ boards have unanimously authorised, is anticipated to shut within the first quarter of subsequent 12 months, pending shareholder and regulatory approvals.
Below the settlement, Stronghold shareholders will obtain 2.52 shares of Bitfarms for every share owned, the press launch reads. This represents a 71% premium to Stronghold’s 90-day volume-weighted common worth on the Nasdaq as of Aug. 16. The mixed firm is projected to realize $10 million in annual price synergies post-merger.
The merger announcement comes as Bitfarms faces a takeover try by Riot Platforms, a competing Bitcoin mining firm. As crypto.information reported earlier, Riot acquired 1 million frequent shares of Bitfarms, elevating its stake to roughly 18.9%. That transfer adopted Riot’s $950 million takeover bid earlier this 12 months, which was withdrawn after failing to achieve traction with Bitfarms’ board.
