Galaxy Digital Holdings Ltd. (TSX:ARBK) (“Argo”) for approximately $65 million.
The transaction will accelerate the expansion of Galaxy’s bitcoin mining operations and services, provide access to tax-efficient mining infrastructure and reduce reliance on third-party hosting providers.
Helios is a large-scale bitcoin mining facility located in Dickens County, Texas, that has the ability to operate up to 180 megawatts (MW) of mining capacity, utilizing immersion cooling technology. Upon receipt of certain approvals, Helios is expected to provide Galaxy with as much as 800 MW of capacity, enabling the Company to grow its proprietary and hosted bitcoin mining infrastructure beyond its previously stated goals. Helios, which sits on a 160-acre campus, commenced operations in May 2022 and is currently staffed by approximately 40 employees who manage day-to-day operations.
“Galaxy is aspiring to be one of the most trusted nodes of the decentralized future,” said Chris Ferraro, President and Chief Investment Officer at Galaxy. “The acquisition of Helios represents a new stage over our two-year journey in bitcoin mining that increases our operating scale and breadth of solutions, creating sustainable value for the biggest decentralized digital asset network and shareholders alike.”
Galaxy intends to utilize Helios as its flagship proprietary mining facility and retain the entire operations team. Galaxy will also begin offering hosting services for third-party bitcoin miners at Helios, creating a new revenue stream for the Company. Galaxy and Argo will work together to ensure a smooth transition at Helios, minimizing disruptions to operations. Galaxy has also pledged to support the various community commitments Argo has established since it began building Helios in July 2021.
In connection with this transaction, Galaxy has agreed to provide Argo with a new senior-secured loan valued at $35 million, secured by a collateral package that includes Argo mining equipment. Argo will also enter into a two-year hosting agreement with Galaxy, securing a place for Argo’s mining machines at the Helios facility.
Helios is the second planned bitcoin mining facility that Galaxy will own and operate. As previously announced, Galaxy broke ground on its first proprietary mining site earlier this year, which is also located in Texas.
“Quality infrastructure and access to low-cost energy are the cornerstones of a successful mining operation, making the acquisition of Helios an incredible milestone for the growth of Galaxy’s mining business,” said Amanda Fabiano, Head of Mining at Galaxy. “We are thrilled to welcome the people supporting Helios to the Galaxy team. We also look forward to having Argo as our first hosting client.”
Galaxy and Argo expect the transaction to close on December 28, 2022.
Galaxy Investment Banking served as exclusive financial advisor to Galaxy on the acquisition of Helios. Kirkland & Ellis LLP served as Galaxy’s legal advisor in connection with the transaction.