The cryptocurrency mining business Argo Blockchain, located in the United Kingdom, has sold its Helios mining facility in the state of Texas to the cryptocurrency investment company Galaxy Digital for the sum of $65 million.
In addition, Galaxy Digital will provide Argo an asset-backed loan with a $35 million principle amount and an initial 36-month term.
The collateral for this transaction will be comprised of 23,619 Bitmain S19J Pro mining machines now operating at Helios and a few rigs situated in Argo’s Canadian data centers.
“This transaction with Galaxy is a revolutionary one for Argo and helps the Company in multiple ways,” said Peter Wall, CEO of Argo Blockchain. In addition to giving us a stronger balance sheet and more liquidity to assist assure continued operations during the protracted bear market, it decreases our debt by $41 million.
All of the proceeds from the sale of Helios, together with a part of the borrowings under the asset-backed loan, will be used to pay off all outstanding debt, including various fees totalling about $84 million and $1 million payable to NYDIG and North Mill Commercial Finance, respectively.
The miner will sign a two-year hosting contract with Galaxy and retain control of all of its equipment in the Texas site. The hosting deal allows Argo to keep up its mining machinery at Helios and minimize any downtime brought on by the selling of the site.
Due to the agreement with Galaxy, Argo blockchain will not yet release its financial results for the third quarter of 2022. Argo is required to comply with local regulatory filing requirements since the SEC has classified it as a foreign private issuer.
After failing to get significant finance from a key investor, Argo Blockchain said in October that it is looking into alternative financing sources. Argo said that it will have to curtail or maybe cease activities if it is unable to get funds at this time.
Compiled by Coinbold