The parties said the combined entity will have a market capitalisation of around $990m and will be equally owned by shareholders of both companies
Canada-based digital asset miner Hut 8 Mining has agreed to an all-stock merger of equals with cryptocurrency mining services provider U.S. Data Mining Group (doing business as US Bitcoin).
The combined entity will be named Hut 8 and will be domiciled in the US.
As part of the terms of the agreement, Hut 8 Mining’s shareholders will receive 0.2 of a share of the newly formed Hut 8 common stock for each share. US Bitcoin stockholders will receive 0.6716 of a share of Hut 8 common stock per share.
The parties said the combined entity will have a market capitalisation of around $990m and will be equally owned by shareholders of both companies.
Hut 8 Mining CEO Jaime Leverton said: “Our established track record of creating shareholder value through organic growth and strategic acquisitions while maintaining a balance sheet-first approach has positioned us perfectly to advance our growth trajectory through this business combination.
“Bringing together Hut 8’s operational track record and diversified revenue streams with US Bitcoin’s scalable mining sites, sizeable hosting business, and industry-leading managed infrastructure operations not only accelerates our diversified strategy and positions us for near-term growth, but also establishes us as a strong, US-based player that is ready and able to seize additional opportunities as they arise.”
Through the transaction, Hut 8 is expected to become a large scale, publicly traded Bitcoin miner with a focus on economical mining as well as highly diversified revenue streams.
Hut 8 is anticipated to have access to nearly 825MW of gross energy across all six sites with self-mining, hosting, and managed infrastructure operations.
US Bitcoin co-founder and CEO Michael Ho said: “We were initially attracted to Hut 8’s strong track record, admirable fiscal management through all market cycles, and like-minded approach to generating diversified lines of revenue.
“Through this process, we’ve determined that the strategic impact this Transaction will drive is significant: we see a clear path to leveraging our collective vision to drive innovative technology advancements and become a second-to-none operator.”
Following the closing of the deal, Hut 8 Mining and US Bitcoin will each become fully-owned subsidiaries of Hut 8.
Subject to court, regulatory approvals, and customary conditions, the transaction is expected to close around or after Q2 2023.