In the volatile crypto market, Bitcoin mining companies have faced financial difficulties, leading to the shutdown of several firms. Core Scientific, a Bitcoin mining entity, has announced the closure of a $55 million equity financing round after regaining its financial footing.
The offering, which ended last week, was met with high demand from investors. Core Scientific’s CEO, Adam Sullivan, stated that following the successful capital raise and full repayment of previously drawn amounts, the company is ready to emerge from Chapter 11 with enhanced liquidity and a strong position to continue implementing its growth plans.
Core Scientific aims to relist on NASDAQ after concluding its bankruptcy proceedings, with its latest financial statement showing $2.3 billion in assets against $1.8 billion in equity and $559 million in liabilities. The company prepaid its outstanding debt balance to creditor Riley Financial on January 4, maintaining access to the existing $35 million fund under the agreement.
The company filed for bankruptcy in December 2022 due to the crypto market downturn, increased energy costs, rising mining difficulty, and debt owed to crypto firm Celsius. Core Scientific’s restructuring plan will allow it to exit bankruptcy with $709 million in net debt and $791 million in equity. Shareholders will own new company shares at a 25:1 exchange ratio, equating to $1.08 per share pre-exchange.
With these developments, note holders will receive $1.628 per dollar of nominal value for convertible notes maturing in April and $1.201 per dollar for notes maturing in August.