2 months ago
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With the Bitcoin mining landscape becoming increasingly competitive, Riot Platforms’ strategic acquisitions position it as an industry leader.
North American Bitcoin mining firm Riot Platforms has announced the acquisition of Kentucky-based Block Mining to expand its mining capabilities. The $92.5 million agreement aims to enhance Riot’s operational capacity and geographic reach.
The release states that Riot is purchasing Block Mining’s two operational sites in Kentucky, a landlocked state in the Southeastern region of the United States. The acquired company has a combined current capacity of 60 MW. This capacity may increase to 110 MW under present agreements. Notably, Block Mining has a potential capacity that could surpass 300 MW, subject to securing the necessary power purchase agreements (PPAs).
For this deal, Riot has paid $18.5 million in cash and $74 million in Riot Platforms common stock. Additionally, it also offers $32.5 million to Block Mining through 2025 for securing further PPAs to increase power capacity.
A Broader Plan
Riot plans to grow Block Mining’s sites to 110 MW for self-mining operations by the end of 2024. This would potentially bring Riot’s total power capacity to an impressive 2 gigawatts.
The move is part of Riot’s broader plan to achieve a self-mining hash rate capacity of 31 EH/s in 2024. Notably, as of June 30, the mining firm boasts 22 EH/s hash rate, which is the third-largest among BTC miners, trailing only Marathon Digital and Core Scientific.
Through this deal, Riot Platforms also aims to expand its exposure to additional energy markets beyond the Electric Reliability Council of Texas (ERCOT). According to the company’s Chief Executive Officer (CEO) Jason Les, this deal enables his company to diversify its operations on a national level.
In 2023, Riot increased its revenue to $280.7 million, up by 8% from $259.2 million in 2022. This success was driven by its partnership with MicroBT, a Chinese Bitcoin miner manufacturer in June 2023.
With the Bitcoin mining landscape becoming increasingly competitive, Riot Platforms’ strategic acquisitions position it as an industry leader. In a separate acquisition plan, Riot Platforms had earlier this year offered an unsolicited proposal to buy another mining firm Bitfarms.
While the Bitfarms Board turned down the offer, Riot created a website “A Better Bitfarms” to support reforms and raised its Bitfarms share to 14.9%. Bitfarms responded with a poison pill approach to dilute Riot’s stake should it approach 15%.
