Argo subsidiary will sell its Helios facility in Dickens County, Texas for $65 million (£54 million) and refinance its asset-backed loans under the terms of the agreement. Furthermore, Galaxy has agreed to host Argo’s mining machines at Helios.
Argo Blockchain, a global leader in cryptocurrency mining, has announced definitive agreements with Galaxy Digital Holdings. Argo subsidiary will sell its Helios facility in Dickens County, Texas for $65 million (£54 million) and refinance its asset-backed loans under the terms of the agreement. Furthermore, Galaxy has agreed to host Argo’s mining machines at Helios.
Galaxy will make a new asset-backed loan to Argo in the amount of $35 million (£29 million) with an initial term of 36 months. This loan will be secured by a collateral package consisting of 23,619 Bitmain S19J Pro mining machines currently in operation at Helios and certain machines at Argo’s Canadian data centres.
Galaxy intends to enter into a fixed-price power purchase agreement with a licenced retail electricity provider to procure electricity for Helios as the facility’s owner. Argo will have access to this electricity at the PPA rate, according to the hosting agreement. Argo will pay Galaxy a hosting fee and work with Galaxy to develop a curtailment strategy in order to participate in certain demand response programmes offered by the Electric Reliability Council of Texas, which oversees the Texas power grid.
Argo will benefit from the transaction by reducing debt by $41 million (£34 million) and providing it with a stronger balance sheet and enhanced liquidity to help ensure continued operations during the current bear market.
Previously, the company requested a suspension of trading on the Nasdaq on the 27th December in response to an announcement and the resumption of trading on 28th December following the announcement.
Because of Crypto Winter, the company has been experiencing financial difficulties. Argo mined 198 Bitcoin or Bitcoin Equivalents in November 2022, compared to 204 BTC in October 2022. The decrease in BTC mined was primarily caused by an increase in Bitcoin network difficulty in November versus October. The Company had 126 Bitcoin as of 30 November 2022, of which 116 were BTC Equivalents.