Global cryptocurrency miner Argo Blockchain enters into LOI to Build 200 MW Mining Facility in Texas

Rhea-AI Summary

Argo Blockchain (LSE: ARB) (OTCQB: ARBKF) has signed a Letter of Intent with DPN LLC to acquire 320 acres in West Texas, enabling the construction of a 200MW cryptocurrency mining facility within a year. The project will benefit from low-cost electricity sourced mainly from renewable energy. The acquisition cost totals $17.5 million, paid through new share issuance, with a pre-negotiated $100 million credit facility to fund development. A shareholder meeting will be called to approve the issuance of shares related to this transaction.

Positive

• Access to 800MW of electrical power for mining operations.
• Opportunity to build a 200MW facility at low electricity rates, primarily from renewable sources.
• Secured $100 million credit facility for capital needs.

Negative

• Acquisition is contingent upon shareholder approval.
• Initial $5 million payment will dilute existing shareholders.

Global cryptocurrency mining company Argo Blockchain (LSE: ARB) (OTCQB: ARBKF) today announced that it has entered into a Letter of Intent (LOI) with DPN LLC of New York, initiating the acquisition of 320 acres of land in West Texas, USA, with access to 800-megawatts of electrical power where Argo intends to build a new 200mw mining facility in the next 12 months.

When completed, the facility will provide Argo with electricity at some of the lowest rates in the world, with the majority of its power coming from renewable sources.

“We are incredibly excited about this agreement,” said Argo Blockchain CEO Peter Wall. “It gives Argo tremendous control over our mining operations, as well as significant capacity for expansion. In addition, we have been able to secure access to some of the cheapest renewable energy worldwide in a location where innovation in new technologies is encouraged and incentivised.”

Once finalized, the overall price of the acquisition will be $17.5 million to be satisfied by the issue and allotment to DPN LLC of new ordinary shares in Argo. Upon completion of the definitive agreement, $5 million worth of new ordinary shares will be issued to DPN LLC. The balance of $12.5 million will be made as milestones related to the project are fulfilled.

In addition, Argo will gain access to a pre-negotiated $100 million credit facility at competitive rates, providing the company with sufficient debt capital to build out the facility and further expand its mining fleet to upscale the company’s operations and capacity.

In connection with the proposed acquisition, Argo plans to issue a circular to shareholders to convene a general meeting where they will be asked to approve the allotment and issue of both the new shares to be issued to DPN LLC as well as the issue of further new shares to raise equity to fund the down payment (or deposit) on the credit facility.

XMS Capital Partners LLC acted as a financial advisor to Argo Blockchain in connection with the transaction.

About Argo:

Argo Blockchain plc is a global leader in cryptocurrency mining with one of the largest and most efficient operations powered by clean energy. The Company is headquartered in London, UK and its shares are listed on the Main Market of the London Stock Exchange under the ticker: ARB and on the OTCQB Venture Market in the United States under the ticker ARBKF.

argoblockchain.com

See Argo's largest facility in Quebec:
https://youtu.be/LDWWaZ75Zbk

View source version on businesswire.com: https://www.businesswire.com/news/home/20210210005451/en/

FAQ

What is Argo Blockchain's recent acquisition about?

Argo Blockchain has entered a Letter of Intent to acquire 320 acres in West Texas to build a 200MW mining facility.

What is the total cost of the acquisition by Argo Blockchain?

The acquisition will cost Argo Blockchain $17.5 million, payable through new shares issued to DPN LLC.

How will the new facility benefit Argo Blockchain?

The facility will provide access to some of the lowest electricity rates globally, mainly from renewable sources.

What financial support has Argo Blockchain secured for the new facility?

Argo has secured a pre-negotiated $100 million credit facility to finance the facility's construction.

When does Argo Blockchain plan to build the new mining facility?

Argo Blockchain intends to complete the construction of the new mining facility within the next 12 months.