Bitfarms Acquires Stronghold Digital Mining in $175 Million Merger
Bitcoin mining company Bitfarms has announced that it has entered into a merger agreement to acquire Stronghold Digital Mining for $125 million in equity and $50 million in debt.
In a joint statement on August 21, the companies said their boards of directors had unanimously approved the transaction. The deal is expected to close in the first quarter of 2025, subject to regulatory approvals and other conditions.
As part of the acquisition, Stronghold shareholders will receive 2.52 shares of Bitfarms for each share of Stronghold they hold. Post-merger, Stronghold shareholders are expected to own less than 10% of the combined company.
Scalability
The merger will increase Bitfarms’ capacity to 307MW, putting it on track to reach 950MW by the end of 2025. In addition to its Bitcoin mining operations, Bitfarms continues to seek capacity expansion to support high-performance computing (HPC) and AI ventures.
Bitfarms CEO Ben Gagnon said the merger was the result of three years of negotiations and that the deal would secure a strong future for the mining operation. He said:
“Through this transaction, we expect to expand and realign our energy portfolio to 950 MW by the end of 2025, approximately 50% of which will be located in the United States. We also believe there is potential for multi-year expansion of up to 1.6 GW, with approximately 66% located in the United States, up from approximately 6% today.”
Riot Platforms’ Acquisition Efforts
The acquisition comes in response to Riot Platforms’ hostile takeover attempt against Bitfarms.
Last week, Riot said it had increased its stake in Bitfarms to 85.3 million shares, meaning the third-largest Bitcoin miner on Wall Street now owns 18.9% of the Canadian mining company, adding a new dimension to its ongoing efforts to pressure Bitfarms management after a failed $950 million takeover bid in April.
Since then, Riot has adopted an approach that has brought about significant changes to Bitfarms’ board of directors, including the abrupt resignation of co-founder Nicolas Bonta and the appointment of Gagnon as the company’s CEO.
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Liam ‘Akiba’ Wright
Liam, also known as “Akiba,” is a reporter, editor, and podcast producer at CryptoSlate. He believes decentralized technologies have the potential to bring about broad positive change.
