Core Scientific Raises $55M in Equity Financing, Paves Way for NASDAQ Relisting Post Bankruptcy
Summary:
Core Scientific, a Bitcoin mining firm, has successfully raised $55 million in an equity financing round, enabling it to emerge from Chapter 11 bankruptcy. The company now stands at a strong position for executing its growth strategies with enhanced liquidity. Post bankruptcy proceedings, Core Scientific aims to do a NASDAQ relisting and has already prepaid its debtor-in-possession (DIP) balance. The company's restructuring plan will allow it to emerge from bankruptcy with manageable net debt and significant shareholder's equity.
Core Scientific, a Bitcoin mining firm, has successfully secured $55 million through an equity financing round, placing itself back on the path to solvency. The fundraising round, which concluded earlier this week, garnered interest that exceeded the original target. Adam Sullivan, the CEO of Core Scientific, announced that after the planned full repayment of drawn amounts from debtor-in-possession (DIP) financing, the company will successfully exit Chapter 11 this month due to the enhanced liquidity. This puts the firm at a strong stance to continue pursuing its developmental goals.
In Core Scientific's recent financial record from November 2023, it stated assets of $2.3 billion alongside $559 million liabilities, making their total equity stand at $1.8 billion. Following the end of their bankruptcy proceedings, they aim to return to trading on the NASDAQ stock exchange.
Earlier this month, Core Scientific informed the public that it had paid the outstanding DIP balance to its lending institution, Riley Financial. The $35 million provision from the DIP contract remains available for the company's use.
The Bitcoin miner had filed for bankruptcy in the final month of 2022, forced by the combination of a languishing crypto market, escalating energy prices, increasing difficultly in mining, and bad debts extended to cryptocurrency firm Celsius. With its restructuring plan, Core Scientific is projected to emerge from bankruptcy with $709 million in net debt and $791 million in shareholder's equity.
The new shares will be distributed to Core Scientific shareholders at a 25:1 exchange ratio, offering them $1.08 for each share they held before the swap. Noteholders are expected to receive $1.628 for every $1 of convertible notes due in April and $1.201 for every $1 of face value for notes due in August.
Related: Core Scientific enters into a $77 million contract with Bitmain for 27,000 Bitcoin mining units.
Published At
1/8/2024 7:26:09 PM
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