Bitcoin Miner Argo Sells Largest Facility to Avoid Bankruptcy

Key Points:

  • Argo to sell mining facility to Galaxy
  • Argo to retain ownership of mining rigs
  • Transaction to close on December 28th
  • Deal reduces Argo's debt load by $41 million
  • Argo to refocus on Canadian operations.

2 - 4 minute read

Bitcoin miner Argo Blockchain has announced that it will sell its largest mining facility in Dickens County, Texas to Galaxy Digital in an effort to avoid bankruptcy. Argo will retain ownership of its 23,619 Bitmain S19J rigs, which will be hosted by Galaxy under a two-year agreement. In addition to the sale, Galaxy will also provide Argo with an asset-backed loan worth $35 million, which will be secured by collateral including the rigs at the facility and other machines at Argo’s data centers in Canada.

The 135,000 square foot Helios plant, which is the world’s largest immersion-cooled mining facility and has access to 800 megawatts of electricity, will be sold for $65 million. The transaction is set to close on Wednesday, December 28th.

The sale of the Helios plant and the loan from Galaxy will reduce Argo’s overall debt load by $41 million and simplify its operating structure. Argo CEO Peter Wall stated in a video message that the company will continue to mine at the Helios facility, despite the sale of the plant.

Argo had previously warned investors that it may not have sufficient funds to last until the end of the year. The company hinted that it was in advanced negotiations to sell some assets under an equipment financing transaction in an effort to avoid bankruptcy.

Following the announcement of the deal with Galaxy, Argo’s shares more than doubled on the London Stock Exchange and jumped 50% during pre-market Nasdaq trade. The company’s shares have fallen more than 90% year to date. As a result of the deal, Argo will refocus its efforts on its Canadian operations, specifically its two data centers in Quebec. The miner has stated that its operations in Canada will not be affected by the Galaxy deal, with the exception of the use of certain mining machines and other assets located in Quebec as collateral for the asset-backed loan.

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