BitFuFu Announces Entry into Letter of Intent to Acquire Majority Stake in 51-MW Bitcoin Mining Facility in Oklahoma, United States

Rhea-AI Summary

BitFuFu (NASDAQ: FUFU) has signed a letter of intent to acquire a majority stake in a 51-megawatt Bitcoin mining facility in Oklahoma, United States. The facility features completed power and mining infrastructure, with a reliable grid power supply at approximately 3 cents per kilowatt-hour.

The facility, located in an unpopulated area, operates air-cooled Bitcoin miners and has demonstrated high hashrate efficiency. The transaction is expected to close in the first half of 2025, subject to definitive agreement, financial and legal due diligence, and other closing conditions.

This strategic move aligns with BitFuFu's North American expansion strategy and their 1GW global power capacity build-up plan, aiming to secure long-term, low-cost power access while strengthening their position in Bitcoin mining.

Positive

• Access to low-cost power at $0.03/kWh
• 51 MW ready-to-use mining infrastructure
• Strategic expansion into North American market
• Facility already operational with proven hashrate efficiency

Negative

• Transaction not guaranteed as it's subject to due diligence and conditions
• Significant capital expenditure required for majority stake acquisition

Insights

Financial Analyst

The potential acquisition of a 51-MW Bitcoin mining facility in Oklahoma represents a strategic move with compelling economics. The facility's $0.03/kWh power cost is notably competitive, sitting well below the industry average of $0.05-0.06/kWh. This cost advantage could translate to approximately 40-50% higher gross mining margins compared to peers.

The key value drivers here are:

• Immediate operational readiness with completed infrastructure, eliminating construction risks and delays
• Grid-connected power supply, offering more stability than off-grid alternatives
• Strategic location in an unpopulated area, which typically means lower operating costs and easier expansion potential

While the purchase price isn't disclosed, based on current market rates for operational mining facilities ($250-350/kW), this facility could be valued between $12.75-17.85 million. This acquisition would mark a significant step toward BitFuFu's 1GW capacity goal, potentially adding 5.1% to their total power capacity.

Energy Infrastructure Expert

The Oklahoma facility's specifications reveal several operational advantages. The $0.03/kWh power rate is particularly noteworthy as it's secured through grid access, providing reliability that off-grid solutions can't match. The air-cooled mining setup, while conventional, offers proven reliability and lower maintenance costs compared to liquid cooling systems.

The facility's location in Oklahoma is strategic for three reasons:

• The state's deregulated energy market allows for competitive power pricing
• Cool average temperatures reduce cooling costs
• Strong grid infrastructure with excess capacity from wind power

The 51MW capacity suggests approximately 15,000-17,000 latest-generation miners could be deployed, potentially generating 1.5-1.7 EH/s of hashrate. This could significantly boost BitFuFu's mining efficiency and market position.

SINGAPORE, Jan. 16, 2025 (GLOBE NEWSWIRE) -- BitFuFu Inc., (“BitFuFu” or “the Company”) (NASDAQ: FUFU), a global leader in Bitcoin mining and comprehensive mining services, announced today that it has signed a letter of intent to acquire a majority stake in a 51-megawatt (MW) Bitcoin mining facility in the State of Oklahoma, United States.

Strategically located in an unpopulated area, the facility has completed construction of its power and mining infrastructure. It boasts a reliable power supply of 51 MW from the grid at a competitive average cost of approximately 3 cents per kilowatt-hour. Operating air-cooled Bitcoin miners, the facility has consistently delivered high levels of hashrate efficiency.

The transaction, expected to close in the first half of 2025 if consummated, is structured as a majority equity acquisition. The proposed transaction is subject to a definitive agreement to be negotiated between the parties, conditioned upon further financial and legal due diligence, as well as other customary closing conditions. There is no assurance that any transaction will be concluded.

“This acquisition would represent a pivotal step in advancing our North American expansion strategy and 1GW global power capacity build-up plan," said Leo Lu, Chairman and CEO of BitFuFu. "By securing access to long-term, low-cost, and reliable power, we are not only enhancing our operational efficiency but also reinforcing our position as a leader in Bitcoin mining. Our ability to identify and capitalize on strategic opportunities is a testament to the scale of our global hashrate network and the insights into mining operations. This transaction underscores our unwavering commitment to delivering sustainable, long-term value to our shareholders while fostering strategic partnerships within the industry."

About BitFuFu Inc.

BitFuFu Inc. is a global leader in Bitcoin mining and comprehensive mining services, providing customers with one-stop solutions including cloud-mining. BitFuFu received early investment from BITMAIN, a world-leading digital asset mining hardware manufacturer, and remains BITMAIN's strategic partner in the Bitcoin mining and mining services space.

BitFuFu is dedicated to fostering a secure, compliant, and transparent blockchain infrastructure, providing a variety of stable and intelligent digital asset mining solutions to a global customer base. Leveraging its expanding global mining facility network and strategic partnership with BITMAIN, BitFuFu enables institutional customers and digital asset enthusiasts to mine digital assets efficiently.

For more information, please visit https://ir.bitfufu.com/.

Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target” or other similar expressions that predict or indicate future events or trends. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of BitFuFu's management and are not predictions of actual performance. These statements involve risks, uncertainties and other factors that may cause BitFuFu's actual results, levels of activity, performance, or achievements to be materially different from those expressed or implied by these forward-looking statements. Although the Company believes that it has a reasonable basis for each forward-looking statement contained in this press release, the Company cautions you that these statements are based on a combination of facts and factors currently known and projections of the future, which are inherently uncertain. All information provided in this press release is as of the date of this press release and the Company does not undertake any duty to update such information, except as required under applicable law.

For investor inquiries, please contact:

Charley Brady
Vice President, Investor Relations 
charley.b@bitfufu.com

General inquiries:

BitFuFu Investor Relations 
ir@bitfufu.com

BitFuFu Media Relations 
pr@bitfufu.com

FAQ

What is the power capacity of BitFuFu's new Oklahoma mining facility?

The Bitcoin mining facility in Oklahoma has a power capacity of 51 megawatts (MW).

What is the power cost at BitFuFu's (FUFU) new Oklahoma mining facility?

The facility has a competitive average power cost of approximately 3 cents per kilowatt-hour.

When is BitFuFu (FUFU) expected to close the Oklahoma facility acquisition?

The transaction is expected to close in the first half of 2025, subject to conditions and due diligence.

What type of cooling system does BitFuFu's new Oklahoma facility use?

The facility operates air-cooled Bitcoin miners.

How does this acquisition align with BitFuFu's expansion strategy?

This acquisition advances BitFuFu's North American expansion strategy and contributes to their 1GW global power capacity build-up plan.