Argo Blockchain, a leader in Bitcoin mining, declared that it had signed binding agreements with Galaxy Digital Holdings. A subsidiary of Argo will sell its Helios facility in Dickens County, Texas, under the terms of the agreement for $65 million to restructure its asset-backed debts.
According to the press release, Argo’s mining equipment will also be hosted at Helios by Galaxy. In addition, it will be given a new asset-backed loan with a total of $35 million and an initial period of 36 months.
However, 23,619 Bitmain S19J Pro mining machines in Helios and a few housed in Argo’s Canadian data centres will be collateral for this loan.
Moreover, the Bitcoin miner can mitigate any mining machine downtime caused by the sale of the Helios facility because of the two-year hosting contract with Galaxy.
The funds from the sale of Helios, together with a part of the borrowing, will be used to repay the debt ($84 million) and interest payments ($1 million). Additionally, a collateral account managed by NYDIG ABL LLC will transfer $6 million to the company upon this repayment.
The deal with Galaxy is transformative for Argo and advantageous to the company in a number of ways, according to Argo’s CEO, Peter Wall.
He said:
It reduces our debt by $41 million (£34 million) and provides us with a stronger balance sheet and enhanced liquidity to help ensure continued operations through the ongoing bear market.
Bitcoin Miner’s Share Suspension Announcement
Yesterday, Argo Blockchain tweeted that Nasdaq has temporarily suspended the trading of its American depositary shares (ADS). Due to today’s news, the company claimed that trading must be put on hold.
The move comes in the period when the company was troubled by financial issues and was the subject of bankruptcy rumours because of rising energy prices and declining Bitcoin BTC pricing.
Rumours were refuted by the team, which stated that it had not yet filed for bankruptcy but admitted that it might not have enough cash in the following month to fund continuous operations.
Additionally, since its shares had fallen below $1 for 30 straight days, it said last week that Nasdaq would be paying it more unfavourable attention. Within the next 180 days, the firm would be delisted from Nasdaq if its share price did not settle over $1.
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