Griid Infrastructure Inc. (NASDAQ:GRDI) shares are trading lower after it inked a definitive merger deal with CleanSpark, Inc. (NASDAQ:CLSK) for a total enterprise value, including payment and assumption of debt, of $155 million.
GRIID Infrastructure, a purpose-built bitcoin mining company founded in 2018, has operated bitcoin mining facilities since 2019.
As per the merger agreement, Griid stockholders will receive CleanSpark common stock based on an exchange ratio determined by dividing the total merger consideration by the number of Griid shares outstanding at closing.
The total merger consideration is calculated as $155 million minus Griid's net liabilities at closing, divided by CleanSpark's two-day volume-weighted average stock price of $16.587 prior to the merger agreement date.
Alongside the merger agreement, the companies signed an exclusive hosting agreement for all available power, with 20 MW allocated to CleanSpark effective immediately.
CleanSpark plans to take on all of Griid's outstanding debt and obligations as part of the merger.
The transaction, unanimously approved by the Boards of Directors of both companies, is anticipated to conclude in the third quarter of 2024.
The completion of the acquisition is contingent upon GRIID shareholder approval and customary closing conditions.
Zach Bradford, CleanSpark's CEO, said, "This acquisition would give us a clear and steady path over the next three years to accomplish in Tennessee what we proudly achieved in Georgia over the past three years. That achievement was to build out over 400 MW of infrastructure backed by valuable, long-term power contracts."
Harry Sudock, GRIID's CSO, stated, "Growing our portfolio of data centers in this attractive region positions us to continue strengthening the resilience of the power grid while delivering CleanSpark's leading mining capabilities."
As of March-end, CleanSpark had almost $700 million in cash and bitcoin, and virtually no debt.
Price Action: GRIID shares are down 48.4% at $1.209 at the last check Thursday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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