Digihost Announces Acquisition of 55 MW Site in Alabama and Full Repayment of $10,000,000 Loan Facility
June 14 2022 - 6:00AM
Digihost Technology Inc. (“
Digihost” or the
“
Company”) (Nasdaq: DGHI; TSXV: DGHI), an
innovative U.S. based Bitcoin (“
BTC”) mining
company, is pleased to announce that it has entered into an
agreement (“
Agreement”) with Grede II, LLC to
acquire property in the state of Alabama in order to expand its
current operational capacity. All monetary references are expressed
in USD unless otherwise indicated.
Terms of the Agreement are as
follows:
- Total purchase price of $2,750,000,
$1,500,000 of which is due on or before June 17, 2022.
- The remaining $1,250,00 is to be
paid in 25 equal monthly installments of $50,000 per month.
- Low-cost electricity supply to be
purchased from Alabama Power.
- Site consists of approximately
160,000 square feet of office and industrial warehouse space with
initial access to 28 MW of power with total capacity of 55 MW.
“The Company has been pursuing opportunities to
significantly increase the capacity of our mining operations and
diversify jurisdictional risk in an environmentally conscious
manner,” said Michel Amar, Chairman and CEO of Digihost. “This
acquisition checked all the boxes for Digihost as the Company is
now in a position to double its current hash rate by access to
clean and renewable energy sources.”
Loan Repayment
On March 2, 2022, the Company announced the
closing of a $10 million committed, collateralized revolving credit
facility (the “Loan Facility”). The Loan Facility
provided Digihost with non-dilutive liquidity options to assist in
the financing of its growth strategy.
The Company is pleased to report that as of
today’s date, the fully drawn Loan Facility has been repaid. The
repayment of the Loan Facility was carried out over the last
several weeks and the Company currently has no long-term debt.
Cash and Digital Inventory
- Cash on hand of approximately $7.9
million.
- Digital inventory, consisting of
BTC and Ethereum (“ETH”), of approximately $8.7
million, based on current BTC and ETH prices, respectively.
- Total cash on hand and digital
inventory of approximately $16.6 million.
“The Company made a commitment to its
shareholders to conservatively manage its balance sheet and to pay
off its outstanding debt by the end of 2022. We are pleased to
announce the acceleration of this timeline in light of current
market volatility”, commented Michel Amar, Chairman and CEO of
Digihost. “Current market conditions are challenging but given the
Company’s existing cash and digital holdings, combined with low
overhead, we are able to remain on solid footing while still
executing on our strategy of gaining access to low-cost
energy”.
Miner Commitments
The Company does not have any outstanding
purchase commitments for miners and in the current environment will
only consider miner acquisitions on an opportunistic basis.
About Digihost
Digihost is a growth-oriented blockchain
technology company primarily focused on BTC mining. Through its
self-mining operations and joint venture agreements, the Company is
currently hashing at a rate of approximately 650 PH/s.
All hosting fees and joint venture profit
sharing are treated as operating expenses in the Company’s
consolidated financial statements.
For further information, please contact:
Digihost Technology
Inc.www.digihost.caMichel Amar, Chief Executive
Officer T: 1-818-280-9758Email: michel@digihost.ca
Cautionary Statement
Trading in the securities of the Company should
be considered highly speculative. No stock exchange, securities
commission or other regulatory authority has approved or
disapproved the information contained herein. Neither the TSX
Venture Exchange nor its Regulation Services Provider (as that term
is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements
Except for the statements of historical fact,
this news release contains “forward-looking information” and
“forward-looking statements” (collectively, “forward-looking
information”) that are based on expectations, estimates and
projections as at the date of this news release and are covered by
safe harbors under Canadian and United States securities laws.
Forward-looking information in this news release includes
information about potential further improvements to profitability
and efficiency across mining operations including, as a result of
the Company’s expansion efforts, potential for the Company’s
long-term growth, and the business goals and objectives of the
Company. Factors that could cause actual results to differ
materially from those described in such forward-looking information
include, but are not limited to: future capital needs and
uncertainty of additional financing, including the Company’s
ability to utilize the Company’s at-the-market offering program
(the “ATM Program”) and the prices at which the Company may sell
securities in the ATM Program, as well as capital market conditions
in general; share dilution resulting from the ATM Program and from
other equity issuances; risks relating to the strategy of
maintaining and increasing Bitcoin holdings and the impact of
depreciating Bitcoin prices on working capital; regulatory and
other unanticipated issues that prohibit us from declaring or
paying dividends to our shareholders that are payable in Bitcoin;
continued effects of the COVID19 pandemic may have a material
adverse effect on the Company’s performance as supply chains are
disrupted and prevent the Company from operating its assets;
development of additional facilities to expand operations in
Alabama may not be completed on the timelines anticipated by the
Company, or at all; approval of the Public Service Commission or
other regulatory or board approvals being received on a timely
basis, or at all; the acquisition of North Tonawanda, New York
facilities closing on timely basis, or at all; ability to access
additional power from the local power grid; a decrease in
cryptocurrency pricing, volume of transaction activity or
generally, the profitability of cryptocurrency mining; further
improvements to profitability and efficiency may not be realized;
the digital currency market; the Company’s ability to successfully
mine digital currency on the cloud; the Company may not be able to
profitably liquidate its current digital currency inventory, or at
all; a decline in digital currency prices may have a significant
negative impact on the Company’s operations; the volatility of
digital currency prices; and other related risks as more fully set
out in the Annual Information Form of the Company and other
documents disclosed under the Company’s filings at www.sedar.com.
The forward-looking information in this news release reflects the
current expectations, assumptions and/or beliefs of the Company
based on information currently available to the Company. In
connection with the forward-looking information contained in this
news release, the Company has made assumptions about: the current
profitability in mining cryptocurrency (including pricing and
volume of current transaction activity); profitable use of the
Company’s assets going forward; the Company’s ability to profitably
liquidate its digital currency inventory as required; historical
prices of digital currencies and the ability of the Company to mine
digital currencies on the cloud will be consistent with historical
prices; the ability to maintain reliable and economical sources of
power to run its cryptocurrency mining assets; the negative impact
of regulatory changes in the energy regimes in the jurisdictions in
which the Company operates; the ability to adhere to Digihost’s
dividend policy and the timing and quantum of dividends based on,
among other things, the Company’s operating results, cash flow and
financial condition, Digihost’s current and anticipated capital
requirements, and general business conditions; and there will be no
regulation or law that will prevent the Company from operating its
business. The Company has also assumed that no significant events
occur outside of the Company's normal course of business. Although
the Company believes that the assumptions inherent in the
forward-looking information are reasonable, forward-looking
information is not a guarantee of future performance and
accordingly undue reliance should not be put on such information
due to the inherent uncertainties therein.
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