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Riot (RIOT, Financial) shares climbed nearly 4% on pre-market trading on Monday after the company signed a term sheet for a potential acquisition of select Rhodium Encore assets at its Rockdale facility through its affiliate, Whinstone US.
The deal is valued at $185 million, comprising $129.9 million in cash, a $6.1 million return of Rhodium's power security deposit, and $49 million in Riot shares. Under the agreement, Rhodium will transfer all tangible property at the facility, including ASIC miners, while both parties will dismiss existing litigation upon closing.
The move is expected to boost Riot's power capacity and enhance its operational assets, reinforcing its Bitcoin-driven infrastructure platform and supporting future growth amid evolving industry dynamics.
Analysts recognize the strategic importance of this deal which offers both significant operational benefit and mining capacity expansion and enhanced operational stability. Riot demonstrates its dedication to expanding Bitcoin mining operations by acquiring the hash rate capacity in this strategic move.
This article first appeared on GuruFocus.