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Canaan acquires Cipher’s 49% stake in West Texas mining operation for $39.75 million in shares.
The transaction provides Cipher with a significant equity stake in the Singapore-based firm.
Racks of mining machines. (Michal Bednarek/Shutterstock)
Key details:
- Canaan Inc. has obtained Cipher Mining’s 49% ownership stake in the ABC Projects, which comprise three active bitcoin mining locations in West Texas.
- The $39.75 million deal was financed through the issuance of 806.4 million Class A ordinary shares.
Canaan Inc. (CAN), known for producing bitcoin mining equipment and managing crypto mining facilities, announced its acquisition of a 49% ownership stake in a joint venture associated with various mining initiatives in West Texas from Cipher Mining (CIFR) for $39.75 million in shares.
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This transaction pertains to Cipher’s interest in the ABC Projects, which include Alborz LLC, Bear LLC, and Chief Mountain LLC. The remaining ownership of the venture is held by WindHQ, as noted in a statement released on Monday.
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The acquisition was financed through the issuance of 806.4 million Class A ordinary shares, which equates to 53.8 million American depositary shares, thereby making Cipher, a U.S.-based bitcoin mining entity that designs and operates large-scale data centers, a substantial stakeholder in Singapore-based Canaan. The shares are subject to a six-month lock-up period.
Canaan’s stock experienced a 6% decline on Monday, while Cipher’s stock rose by 4%. Cipher is expected to announce its fourth-quarter earnings prior to the market opening on February 24.
The sites collectively have an operational power capacity of 120 megawatts and facilitate approximately 4.4 exahashes per second (EH/s) of hashrate. The fleet efficiency is about 25.7 joules per terahash (J/TH).
Additionally, as part of the agreement, Canaan acquired 6,840 Avalon A15Pro mining rigs that were formerly utilized at Cipher’s Black Pearl facility, which is being repurposed into an AI and high-performance computing data center.
