Argo Blockchain agrees to sell helium facility to Galaxy Digital for $65 million

One of the many struggling crypto mining companies – Argo Blockchain – will try to avoid bankruptcy by selling its Helius facility to Mike Novogratz’s Galaxy Digital.

The agreement will be worth 65 million dollars and aims to reduce the company’s overall debt.

Agreement

Argo made the announcement earlier on December 28, informing that it will also refinance its asset-backed loans with a new one from Galaxy Digital worth $35 million with an initial term of 36 months. Adding the sale of Helius for $65 million, the mining company said this will reduce its total debt by $41 million.

The transactions are expected to be completed by the end of the day. Galaxy has also agreed to host the fleet of Bitmain S19J Pros on Helius, while Argo will maintain ownership of all the machines. They will serve as the new loan’s security.

“Argo will maintain ownership of its fleet of Bitcoin miners, representing approximately 2.5 EH/s of total hashrate capacity. Our miners currently operating on Helios will continue to be hosted there by Galaxy, which is a high-quality, institutional participant in the Bitcoin mining area – said the company’s CEO, Peter Wall.

Argo said the cash flow from the deal will allow it to “repay all existing debt, prepayment interest and other charges of approximately $84 million and $1 million owed to NYDIG ABL LLC and North Mill Commercial Finance, LLC, respectively.”

The mining company added that only part of its Canadian-based operations will be affected by the deal, including “mining machines and other assets located in Quebec” that will be used as collateral for the asset-backed loan.

Argo’s problems

With the start of the bitcoin bear market earlier this year, many miners started to feel the pain almost immediately, having to sell more BTC than mine to cover the rising costs. The rapidly increasing hash rate and difficulty didn’t help them either.

Argo was among those hit hard, with share prices falling by more than 50% after announcing negative cash flow for a few consecutive quarters. The company was unable to outline its Q4 results in today’s statement because the UK FCA “requires semi-annual reporting of financial results,” and Argo is “designated by the SEC as a foreign private issuer and is required to comply with regulatory filing requirements in its home market.”

Still, Argo said the shares would open for trading on Nasdaq today following the suspension request yesterday.