Bitfarms to Acquire Stronghold Digital in $175M Merger Deal Targeting Multi-Year Expansion Capacity of 1.6 GW

Cryptocurrency mining giant Bitfarms has entered a definitive merger agreement to acquire Stronghold in a stock-for-stock merger transaction.

Cryptocurrency mining firm Bitfarms has announced a definitive merger agreement to acquire Stronghold in a stock-for-stock merger transaction.

The all-stock transaction is valued at approximately $175 million, including $125 million in equity value and $50 million in assumed debt. Upon closing, Stronghold shareholders will own approximately 18% of the outstanding Bitfarms shares.

The merger is expected to expand Bitfarms’ energy portfolio, increasing its capacity to over 950 MW by the end of 2025, with potential future expansions bringing total capacity to 1.6 GW.

Bitfarms currently has a hashrate capacity of approximately 5.0 EH/s, ranking among the largest publicly traded crypto miners globally.

Stronghold, on the other hand, has a 4.0 EH/s hashrate and 165 MW of power capacity as of June 2024. The company owns over 750 acres of land and two power plants in Pennsylvania.

“This merger is a transformative step in our strategy to become the leading vertically integrated digital asset company in North America,” said Bitfarms CEO Ben Gagnon in a statement.

“With this acquisition, we will have visibility on multi-year expansion capacity up to 1.6 GW with approximately 66% in the U.S., up from approximately 6% today.”

The merger is expected to close in the first quarter of next year, pending shareholder and regulatory approvals.

Both companies’ boards have unanimously approved the transaction.

The merger agreement was negotiated by Bitfarms’ legal counsel, Dentons Canada LLP, and Stronghold’s legal counsel, Latham & Watkins LLP.

Bitfarms expands portfolio amid takeover attempts

The merger announcement comes as Bitfarms faces a takeover attempt by Riot Platforms, a competing Bitcoin mining company.

As crypto.news earlier reported, Riot acquired 1 million common shares of Bitfarms, raising its stake to approximately 18.9%.

That move followed Riot’s $950 million takeover bid earlier this year, which was withdrawn after failing to gain traction with Bitfarms’ board.

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