Hut 8 (HUT) and U.S. Bitcoin are the latest crypto miners rushing to take advantage of the January Bitcoin rally.
Two firms announced their merger Wednesday, the latest deal in a wave of consolidation and balance sheet shuffling from battered miners still struggling with losses from last year. The new company would combine the two firms' resources and create a new crypto-mining giant named Hut 8 Corp.
Also referred to as «New Hut,» the transaction will create a company that is listed on both the Toronto Stock Exchange and the Nasdaq. The companies said that the combined firm will have a market capitalization of $990 million and will be owned by shareholders of both firms.
«New Hut will have access to approximately 825 MW of gross energy across all six sites with self-mining, hosting, and managed infrastructure operations,» the companies said in a press release.
The deal is expected to establish New Hut as a large-scale, publicly traded Bitcoin miner that can strengthen its balance sheet and gain access to capital-raising opportunities.
“This transaction has given us the opportunity to leverage the significant, unencumbered Bitcoin stack we have HODLed to date,” said Jaime Leverton, CEO of Hut 8. “During the interim period, we plan to cover our operating costs through a combination of selling the Bitcoin we mine, selling from our stack, and/or exploring various debt options."
Hut 8 stock fell 8.6% in Tuesday trading after the merger announcement.
While some miners have been able to buy new mining rigs and sites at firesale prices during bitcoin's downturn, others have been forced to file for bankruptcy or restructure.
Austin's Core Scientific (CORZ) filed for bankruptcy in late December. Greenridge Generation Holdings
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