Argo Blockchain Announces Plans to Strengthen its Balance Sheet, Shares Dip Over 26%
- Argo shares have declined over 80 per cent in the last year, besides the 74 per cent drop YTD.
- The company has executed a non-binding letter of intent to amend its existing equipment financing agreement with an affiliate of New York Digital Investment Group LLC.
- The company expects to achieve a total hashrate capacity of 2.9 EH/s by October 2022.
Argo Blockchain PLC ADR (NASDAQ: ARBK), a UK-based technology company focusing on Bitcoin and other crypto assets’ mining, has announced strategic actions to strengthen its balance sheet. The company intends to sell 3,400 mining machines for cash proceeds of £6.0 million ($6.8m). Additionally, the company has announced plans to raise approximately £24 million ($27m) via a Proposed Subscription with a strategic investor.
The crypto mining company previously announced that the price of both natural gas and electricity caused by the geopolitical situation in Europe and low levels of natural gas storage in the United States has significantly affected its output.
Moreover, the company’s stock market has declined over 80 per cent in the last year, besides the 74 per cent drop YTD. Worth noting that Argo shares have recorded a significant decline since Russia shut down its oil and gas supply to Europe.
The Company has executed a non-binding letter of intent to amend its existing equipment financing agreement with an affiliate of New York Digital Investment Group LLC. Reportedly, the amendment releases approximately £5.0 million ($5.7 million) of restricted cash and modifies the amortisation schedule for the company’s existing loans.
Peter Wall, Chief Executive at Argo Blockchain, said, “We are glad to have a strong relationship with our lender NYDIG, who has been working with us to provide flexibility and to help ensure the company’s long-term success.”
Argo Blockchain and the Crypto Mining Industry
The cryptocurrency mining industry has significantly evolved in the past few years, leave alone the increased difficulty. Argo Blockchain has felt the effect of increased competition, particularly after the Ethererum network transitioned to the Proof-of-Stake (PoS).
The blockchain mining company has signed an agreement to sell to a third party 3,400 new-in-box Bitmain S19J Pro machines, representing ~340 PH/s of total hashrate capacity, for cash proceeds of £6.0 million ($6.8 million). Argo will host these machines for the third party at Helios pursuant to a hosting services agreement that includes a profit-sharing arrangement.
After accounting for this sale, the company expects to achieve a total hashrate capacity of 2.9 EH/s by October 2022.
Forward, Argo has announced that it has agreed with an investor to subscribe for approximately 87 million Ordinary Shares at £0.276 per share for gross proceeds of approximately £24 million ($27 million).
The company reported that it intends to channel the cash towards working capital and general corporate purposes. Furthermore, the blockchain mining company is building out its flagship Helios facility in Dickens County, Texas.
Should the subscription of shares go through, the said investor will hold approximately 15.46 per cent of the company’s enlarged issued share capital.
Otherwise, the company has a market valuation of approximately $181.87 million with 47.78 million shares outstanding. Having been rated eight times in the recent times, MarketWatch found out that Argo shares received an average rating of Buy.
Rebecca is a Senior Staff Writer at BitcoinWisdom, working hard to bring you the latest breaking news in the cryptocurrency market. In the words of Elon Musk “Buy stock in several companies that make products & services that *you* believe in. Only sell if you think their products & services are trending worse. Don’t panic when the market does. This will serve you well in the long-term.”
