New York: Argo Blockchain rallied in London trading after agreeing to sell its Helios Bitcoin mining facility to Galaxy Digital Holdings Ltd. for about $65 million, giving the embattled company some breathing room.
As part of the deal, Galaxy also agreed to provide Argo with a senior secured loan valued at $35 million, backed by a collateral package that includes mining equipment, according to a statement on Wednesday. The transactions will reduce Argo’s indebtedness by $41 million, it said.
Argo shares surged as much as 140 per cent on the news, and were up 90 per cent at 1:17 pm in London. That still left the stock down 92 per cent for the year.
Bitcoin miners like Argo have been hurt by a combination of tumbling crypto prices and rising electricity costs, sending the industry into turmoil. The London-based firm warned in October that it would have to cease or limit operations without additional funding. Several other miners have recently gone bankrupt or warned of financial difficulties.
Argo started operations at the Helios facility in Dickens County, Texas, in May. Helios boasts capacity of up to 800 megawatts to power Bitcoin mining operations, making it one of the largest sites in the state. It is staffed by about 40 employees, according to Wednesday’s statement.