CleanSpark’s recent acquisition of GRIID Infrastructure has caught the attention of analysts at H.C. Wainright, who are optimistic about the potential benefits for CleanSpark. The all-stock deal, valued at $155 million, is expected to accelerate CleanSpark’s development of high-quality, cost-effective power infrastructure in the coming years.
According to initial estimates, CleanSpark may pay around $86 million for the acquisition, which aligns with GRIID’s market cap as of June 27. This will involve issuing 5.2 million shares, approximately 2.5% of its total shares, assuming a share price of $16.587. Analysts at H.C. Wainright have reiterated their Buy rating on CleanSpark, anticipating significant growth opportunities as a result of this deal.
In addition to taking on GRIID’s debt and responsibilities, CleanSpark has provided a $5 million working capital loan and a $50.9 million pay-down bridge loan to support GRIID during the transition. These loans are secured and hold seniority over GRIID’s other debts.
Despite the higher cost per megawatt of recent transactions, CleanSpark views GRIID’s substantial energy pipeline in Tennessee as a valuable strategic asset. The company aims to add over 400 MW of data center infrastructure in Tennessee within the next two and a half years, with plans to bring 100 MW online by the end of 2024 and 200 MW by 2025. Together with its existing 450 MW capacity and other expansion projects, CleanSpark is targeting a total infrastructure capacity of over 1 GW by 2026.
The acquisition is expected to close in Q3 2024, pending GRIID shareholder approval and other conditions. This move is seen as a significant step towards CleanSpark’s goal of expanding its infrastructure capacity and strengthening its position in the energy sector. Investors and analysts alike are closely watching the developments unfold, with expectations of positive outcomes for CleanSpark in the long run.