TL;DR:
- Canaan acquired 49% of Cipher’s stake in the ABC Projects, three operational mining sites in West Texas, for $39.75 million.
- The deal was financed through the issuance of 806.4 million Class A ordinary shares, making Cipher a key shareholder of Canaan.
- The three sites operate 120 MW of energy capacity and support approximately 4.4 EH/s of hashrate at an efficiency of 25.7 J/TH.
Canaan acquired the 49% equity stake that Cipher Mining (CIFR) held in the ABC Projects, a group of three operational bitcoin mining sites in West Texas, for $39.75 million paid entirely in shares. The transaction was announced through an official press release from the Singapore-based company.
The ABC Projects comprise three entities: Alborz LLC, Bear LLC and Chief Mountain LLC. The remaining 51% of the joint venture structure is held by WindHQ LLC, an operating partner with extensive experience in wind energy and electrical infrastructure in Texas’s ERCOT market. The sites collectively operate 120 megawatts of capacity, support approximately 4.4 exahashes per second of hashrate and record a fleet efficiency of 25.7 joules per terahash.
Payment was structured through the issuance of 806.4 million Class A ordinary shares of Canaan, equivalent to 53.76 million American Depositary Shares valued at $0.7394 per unit, subject to a six-month lock-up period. This transaction has made Cipher a significant shareholder within Canaan, without the mining hardware manufacturer having to deploy any liquidity.
Cipher Becomes a Major Canaan Shareholder
As part of the agreement, Canaan also acquired 6,840 Avalon A15Pro mining units that were operating at Cipher’s Black Pearl site, currently in the process of being converted into an artificial intelligence and high-performance computing data center.
Nangeng Zhang, chairman and chief executive officer of Canaan, described the transaction as a disciplined expansion of the company’s presence in North America. Tyler Page, CEO of Cipher, noted that his company holds strong conviction in Canaan‘s potential and stated that accepting an equity position is a demonstration of confidence in the management team’s ability to execute.
Canaan shares fell 6% on Monday, while Cipher shares rose 4%. The American company had been scheduled to report its fourth-quarter results on February 24 before the market open.
