Bitfarms (TSX: BITF) is set to expand its bitcoin mining capacity with the acquisition of Stronghold Digital Mining (NASDAQ: SDIG) in an all-stock transaction valued at US$175 million.
The addition of Stronghold and its assets is expected to add 4.0 EH/s of hashrate to Bitfarms’ operation. Current fleet upgrade options available to Stronghold meanwhile provide the opportunity for that hashrate figure to expand to 10 EH/s in 2025.
In addition to operating hashrate, Stronghold, a vertically integrated crypto asset miner, currently has 165 MW of generated power capacity, as well as 142 MW of import capacity through a Pennsylvania-New Jersey-Maryland interconnection. Up to 790 MW of potential power is said to be available for import beyond 2025. On a combined basis, the pro-forma entity is said to have a clear path to 950 MW of active power capacity by the end of 2025.
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“After three years of ongoing discussions, I am proud to announce this transformative acquisition, which is a decisive step in securing a strong future for Bitfarms. With this transaction, we expect to expand and rebalance our energy portfolio to 950 MW with nearly 50% in the U.S. by the end of 2025 and have visibility on multi-year expansion capacity up to 1.6 GW with approximately 66% in the U.S., up from approximately 6% today,” commented Bitfarms CEO Ben Gagnon on the transaction.
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“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,” he continued.
Under the terms of the transaction, Stronghold shareholders are to receive 2.52 shares of Bitfarms for each share held, representing a price per share figure of US$6.02. The figure is a 71% premium to the 90-day volume weighted average price of Stronghold.
The transaction remains subject to shareholder and regulatory approval. The transaction is currently slated to close in the first quarter of 2025.
Bitfarms last traded at $3.05 on the TSX.
Information for this briefing was found via Edgar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
