Core Scientific Signs $100 Million for Common Stock Purchase Agreement Amid Market Slump

  • The $100 million Core Scientific equity deal will serve as a measure to help it enhance its liquidity while also strengthening its balance sheet.

Core Scientific (CORZ), a leading publicly traded blockchain data center provider and miner of digital assets, announced on Thursday that it has signed a $100 million Common Stock Purchase Agreement with investment bank B. Riley.

The Chief Executive Officer of Core Scientific, Mike Levitt comments on the announcement saying;\

“Securing access to additional capital during adverse market conditions enhances our liquidity and expands our strategic optionality.”

Core Scientific Issues 573,381 shares to B. Riley

According to the announcement, the terms of the agreement offer Core Scientific the right, without obligation, to sell and issue up to $100 million of shares of its common stock to B. Riley. Although, the purchase term is not exclusive as it is subject to certain limitations and must satisfy specified conditions. The announcement further revealed that the purchase notices may be issued to B. Riley over 24 months.

Following the Bitcoin miner’s consideration for B Riley’s commitment to purchase Core Scientific shares, it has issued the investment bank 573,381 shares of common stock under the purchase agreement. 

The recent market crash has seen the shares of crypto companies including publicly traded miners plunge significantly. The financial distress did not omit Core Scientific as the bitcoin mining firm has seen a more than 50 percent decline in the value of its stock this year.

However, the $100 million equity deal will serve as a measure to help it enhance its liquidity while also strengthening its balance sheet. Hence, serving as an alternative to help the Bitcoin miner firm survive the distressing market condition. 

Levitt continued while acknowledging the relevance of its newly signed committed equity facility with B. Riley, claims that it will help sustain its growth amid the ongoing bear market.

“We continue to strengthen our balance sheet and streamline our operations as we remain focused on expanding our capacity for self- mining and colocation services. This Committed Equity Facility with B. Riley is an important additional funding source that will help us grow and create shareholder value,” Levitt added.

Before Core’s common stock purchase agreement with B. Riley has been selling some of the Bitcoin it is mining in a bid to manage its financial woes and fund its firm. The mining company disclosed its plans to cash in on more self-mined bitcoins a few weeks ago. The aim was to use the proceeds to cover expenses, growth, and debt payments

The firm said it is working to strengthen its balance sheet and enhance liquidity to meet this challenging environment. As such, the company sold up to 7,202 bitcoins in July at an average price of $23,000 to raise about $167 million.

Rebecca Davidson Verified

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.”

Latest News