Riot Platforms Completes Major Rhodium Asset Acquisition
Riot Platforms Completes Major Acquisition of Rhodium Assets
Riot Platforms, Inc. (NASDAQ: RIOT) has successfully finalized an impactful acquisition of certain Rhodium Encore LLC assets at its Rockdale Facility. This strategic move is set to enhance Riot's operational capabilities significantly.
Key Benefits of the Acquisition
The acquisition immediately terminates existing unprofitable legacy hosting contracts with Rhodium that had previously caused financial strain. By taking over Rhodium's 125 MW of power capacity at the Rockdale Facility, Riot has effectively redirected all of this power toward its own operations, ensuring that it is fully utilized to support its Bitcoin mining initiatives.
Financial Details
The total consideration for this transaction was an impressive $185 million, broken down into several components: Riot invested $129.9 million in cash, reclaimed $6.1 million from Rhodium's power security deposit, and issued approximately 6.99 million shares of Riot common stock at $7.01 each based on a ten-day trading weighted average. This financial strategy emphasizes Riot's commitment to enhancing its infrastructure while minimizing trading dilution.
Operational Integration
As part of the transaction, Riot takes ownership of all tangible assets previously operated by Rhodium at the Rockdale Facility, including essential ASIC miners. The company is now evaluating the optimal use of this expanded capacity with an emphasis on maximizing shareholder value. Ending their previous contracts allows Riot to increase efficiency and work towards reducing associated litigation costs.
CEO Jason Les on the Acquisition
Jason Les, CEO of Riot Platforms, commented on the significance of this acquisition, stating, "This transaction represents a pivotal moment for Riot as it alleviates the financial burden of a legacy contract, enhances our power attraction capabilities, and builds our operational hash rate. Furthermore, it enables us to redirect resources into valuable operational areas of our business."
About Riot Platforms, Inc.
Riot Platforms, Inc., trading on NASDAQ as RIOT, envisions itself as a leader in the Bitcoin-driven infrastructure sector. The company is dedicated to creating a positive impact on various markets and communities, leveraging innovative solutions and robust partnerships.
Riot is aggressively pursuing a vertically integrated operational model for its Bitcoin mining initiatives, primarily focusing on locations in Texas and Kentucky. Additionally, Riot manages electrical switchgear engineering and fabrication in several locations, including Denver, Colorado, and Houston, Texas, to support its expansive operations.
Frequently Asked Questions
What did Riot Platforms acquire from Rhodium?
Riot Platforms acquired specific assets from Rhodium, including a 125 MW power capacity and tangible property at the Rockdale Facility.
What is the total cost of the acquisition?
The total consideration for the acquisition was $185 million, which included cash, a return of a security deposit, and stock issuance.
How will this acquisition benefit Riot Platforms?
This acquisition allows Riot to terminate unprofitable contracts, utilize full power capacity at the Rockdale Facility, and enhance operational efficiency.
Who is the CEO of Riot Platforms?
The CEO of Riot Platforms is Jason Les, who highlighted the acquisition's potential to boost the company's strategic position.
Where does Riot Platforms operate?
Riot Platforms operates Bitcoin mining facilities primarily in Texas and Kentucky, alongside engineering operations in Colorado.
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