CleanSpark, Griid Infrastructure enter definitive merger agreement

CleanSpark (CLSK) and GRIID Infrastructure Inc. (GRDI) announced that they have entered into a definitive merger agreement pursuant to which CleanSpark will acquire all the issued and outstanding common stock of GRIID in an all-stock transaction. The total enterprise value, including payment and assumption of debt, of the transaction is $155 million. Concurrent with the signing of the merger agreement, the companies also entered into an exclusive hosting agreement for all currently available power, of which 20 MW will be allocated to CleanSpark effective immediately. Under the terms of the merger agreement, GRIID stockholders will receive shares of CleanSpark common stock based upon an exchange ratio equal to the quotient obtained by dividing the aggregate merger consideration by the total number of shares of GRIID common stock issued and outstanding as of the closing date of the merger. The aggregate merger consideration is equal to the quotient obtained by dividing the sum of $155,000,000 minus the amount of GRIID’s outstanding liabilities as of the closing date of the merger by $16.587. CleanSpark will assume all outstanding debt and other obligations of GRIID pursuant to the merger. CleanSpark also provided GRIID with a $5 million dollar working capital loan and a pay-down bridge loan of approximately $50.9 million that was used to satisfy certain obligations of GRIID at signing. The loan is secured and is senior to all other outstanding debt of GRIID. GRIID operates bitcoin mining data centers in various cities and towns throughout Tennessee that are serviced by Tennessee Valley Authority, the largest and one of the most important public power companies in the United States. Like CleanSpark, GRIID has taken a community-first approach to building its data centers, embedding itself into the towns and communities it operates in. In addition to GRIID’s corporate headquarters in Cincinnati, Ohio, they operate a Research and Development Center in Austin, Texas, and a Development, Deployment, and Equipment Repair Center in Rutledge, Tennessee. Their four mining facilities are in Watertown, New York and Limestone, Maynardville and Lenoir City, Tennessee. The transaction has been unanimously approved by the Boards of Directors of both companies and is expected to close in the third quarter of 2024. The acquisition is subject to GRIID shareholder approval and other customary closing conditions.