By Michael Scott
Bitcoin mining firm Hut 8 Corp is set to complete the merger with US Bitcoin Corp (USBTC) following the deal’s approval by British Columbia’s Supreme Court. The court approved the deal to have USBTC merge with Hut 8 into a single mining company.
The merger deal is set to progress since its unveiling in February 2023. It involves the Canadian firm Hut 8 Mining, listed on the Toronto Stock Exchange (TSX) and Nasdaq, combining with USBTC. The merger will yield Hut 8 Corp that will assume domicile in the US. The approval of the deal allows the parties to finalize the deal by the end of 2023.
Court Approval Triggers Rally in Hut 8 Share Price
The news of the approval by the Canadian Supreme Court triggered an increase in Hut share price by 2.82%. The Hut 8 shares will continue trading on both the Nasdaq and TSX.
The conclusion of the merger transactions is reliant on several conditions. The parties are awaiting the USBTC registration. Also, they await the USBTC’s stockholders to approve the deal.
Hut 8 indicated in a Monday press release that the deal awaits the finalizing of closing conditions related to transactions of such nature. Hut 8 emphasized that it would assume a quiet period till the conclusion of the transaction.
A review of today’s stock performance shows Hut 8 shares rallied 2.89% to realize $$1.955. Although it tested the day’s low at $1.865, the miner’s stock recovered to test the day’s high of $1.9699 as per Market Watch data.
Hut 8 Shareholders Portray Support for Merger with USBTC
The Canadian mining firm had its shareholders voting overwhelmingly in support of the merger with USBTC. The mining firm’s chief executive, Jaime Leverton, indicated that it values progression as a new entity. As such, it pursues economic mining while diversifying its revenue streams. It considers it viable to integrate hosting services alongside high-performance computing.
The merger will transform Hut Corp into North America’s largest Bitcoin mining firm by hash rate. Also, the post-merger firm would become the healthiest. MinerMag researcher Wolfie Zhao noted that Hut 8 is among the miners portraying financial health. The analyst observed that its balance sheet has closer to 10,000 bitcoins and carries minimal debt.
Hut B is expanding its scope to offer hosting services. Such involves mining firms allowing individuals to rent out their equipment to mine themselves.
Hut 8 Considering Computing and Managed Infrastructure Operations
Besides hosting, it considers integrating high-performance computing and attracting public miners such as Iris Energy. It leverages the ongoing artificial intelligence (AI) wave by utilizing the existing data center capacity.
Hut 8 plans to embrace the managed infrastructure operations involving maintaining third-party-owned mining sites by utilizing purpose-built software.
In the recent period, Hut has suffered declined earnings in its year-over-year activity. A review of its quarterly performance shows that its revenue slipped from $43.8 million in the second quarter of 2022 to $19.2 million in 2023’s second quarter.
The firm attributes the decline in its earnings to legal and equipment failure challenges witnessed within the Drumheller and North Bay facilities. Also, the period coincided with increasing Bitcoin network difficulty.