In addition to the sale, Galaxy will also provide Argo with a $35 million equipment finance loan to help the company reduce its debt. These transactions aim to reduce Argo's total debt by $41 million and improve its liquidity and operating structure, allowing the company to continue its mining operations.
Argo Blockchain Struggling to Secure Financing, Sells Helios Mining Facility
Argo Blockchain has been struggling to secure financing and faced the possibility of closing after failing to raise $27 million via subscriptions for ordinary shares. In October, the company announced it was at risk of closing due to a lack of new financing. To avoid filing for bankruptcy, Argo announced in mid-December that it was negotiating to sell its assets and trying to "engage in an equipment financing transaction." The recent deal with Galaxy Digital, in which Argo sold its Helios mining facility for $65 million and received a $35 million loan, aims to improve the company's liquidity and operating structure.
Details of Argo Blockchain's Deal with Galaxy Digital
As part of the deal with Galaxy Digital, Argo Blockchain will sell its flagship mining facility, Helios, for $65 million. In addition to the sale, Galaxy will provide Argo with a $35 million equipment finance loan to help the company reduce its debt. These transactions aim to reduce Argo's total debt by $41 million and improve its liquidity and operating structure.
Argo CEO Peter Wall stated that the deal was the "only viable path forward" through the current bear market, which high energy costs and a low Bitcoin price have exacerbated. Despite the sale of the Helios facility, Argo will continue to operate its mining machines at the location and has signed an agreement to do so.
Argo Blockchain's Helios Mining Facility: A Brief Overview
Argo Blockchain's Helios mining facility, which was officially launched in May 2022, is located in Dickens County and is the largest facility operated by the company. It has a capacity of 200 megawatts (MW) of electricity, which is significantly higher than Argo's other facility, Baie Comeau, which operates at 15 MW.
The Helios facility was sold to Galaxy Digital as part of a deal that also included a $35 million equipment finance loan to help Argo reduce its debt. Despite the sale, Argo will continue to operate its mining machines at the facility and has signed an agreement to do so.
