American Bitcoin mining giant Riot has acquired Kentucky-based mining firm Block Mining in a deal worth $92.5 million.
On July 24, Riot Platforms announced that the acquisition involved a purchase price of $18.5 million in cash from its balance sheet plus $74 million of Riot’s common stock.
It stated that Block Mining could earn an additional consideration of up to a maximum of $32.5 million based on performance through 2025.
Riot said the deal immediately increases its hashrate and provides exposure to additional energy markets outside of the Electric Reliability Council of Texas.
Block Mining consists of two operational sites in Kentucky, with a current capacity of 60 megawatts (MW). Riot says it intends to expand it to 110 MW by the end of 2024.
“Additionally, Block Mining owns a greenfield expansion opportunity also in Kentucky, adjacent to an existing substation, presenting an opportunity to develop 60 MW and with potential to expand to 150 MW,” it added.
Riot CEO Jason Les said that the acquisition allows the firm to diversify its operations nationally and expand into Kentucky.
He added that it also provides a pipeline for its Kentucky operations to scale to over 300 MW, thus accelerating the company’s path toward its growth target of 100 exahashes per second (EH/s).
“This partnership presents a unique opportunity for Riot to expand geographically in a cost-effective manner, tapping into new energy markets in the great state of Kentucky,” said Michael Stoltzner, co-founder and CEO of Block Mining.
Riot Platforms had a surge in deployed hashrate in June, with a 50% increase over the month, enabling the firm to mine 255 Bitcoin (BTC).
The firm completed hardware installations at its Corsicana, Texas, facility and tapped into additional available capacity at its Rockdale facility in the same state, which contributed to the additional hashrate.
Related: Riot subsidiary Whinstone US sues former JV partner over revenue flow
Riot also aggressively tried to take over rival mining firm Bitfarms with a $950 million buyout offer in mid-June.
The firm notched a win on July 24 when a Canadian tribunal terminated Bitfarms’ “poison pill” strategy, which was aimed at preventing the takeover attempt by Riot, effectively removing a major obstacle in its acquisition efforts.
Riot Platforms, through its subsidiary Whinstone US, is also embroiled in a legal dispute with its former joint venture partners over a Bitcoin mining operation at a large mining facility in the United States.
The conflict, which involves accusations of fraud, conspiracy, and securities violations, has escalated to the point where Riot’s subsidiary has sued for damages exceeding $1 million.
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