Argo Blockchain Plc’s share rose, find out why?
The share price of UK-based Bitcoin miner Argo Blockchain PLC (LSE: ARB; NASDAQ: ARBK), surged more than 100% during UK trading hours this Wednesday, closing up 73.33% on the London Stock Exchange.
Source: LSE, 5-day chart of Argo Blockchain Plc
According to the London Stock Exchange (LSE), the share price on December 28, 2022 rose from 3.60 to 8.49. However, the previous closing price on 28 December 2022 was 6.50.
The reason it came out here is that the company announced it would sell its Texas-based Helios facility to Galaxy Digital Holdings Ltd (TSX: GLXY ) (“Galaxy”), a financial and investment management firm led by billionaire investor Mike Novogratz.
Britain’s Argo Blockchain Plc (ARB.L) said on Dec. 28, 2022 that it will sell its mining facility, Helios, for $65 million that will refinance a new asset-backed loan to avoid bankruptcy.
It recently mentioned in its tweet that “We have closed the sale of Helios to Galaxy Digital.” It also noted the benefits of the deal as it will reduce debt by $40 million, improve liquidity, simplify its operating structure and allow the company to continue mining operations.
Argos “Press Release” highlights
- Argos subsidiary to sell its Helios facility to Galaxy for $65m (£54m) and refinance asset-backed loans with a new $35m (£29m) loan with Galaxy
- Transactions will reduce total debt by $41m (£34m) and simplify Argo’s operating structure
- Argo will maintain ownership of all mining machines and Galaxy will host Argo’s fleet of Bitmain S19J Pros on Helios
- Transactions will strengthen Argo’s balance sheet, improve Argo’s liquidity position and enable the company to continue operations
In light of the transaction with Galaxy, Argo will not report earnings results for Q3 2022 at this time. The company is designated by the SEC as a foreign private issuer and is required to comply with regulatory requirements for registration in the domestic market. The UK Financial Conduct Authority requires half-yearly reporting of financial results.
As previously disclosed, Argo requested the suspension of trading of its ADSs and unsecured notes on Nasdaq on Tuesday, December 27, 2022. It must be noted that the crypto mining industry was hit hard this year amid rising energy costs and falling Bitcoin prices.
The CEO’s statement
Peter Wall, CEO of Argo Blockchain, said “This transaction with Galaxy is a transformational transaction for Argo and benefits the company in several ways. It reduces our debt by $41m (£34m) and gives us a stronger balance sheet and improved liquidity to ensure continued operation through the ongoing bear market.”
