Argo Blockchain raises $7.5 million to repay debt

The mining company Argo Blockchain raised £5.75 million (~$7.5 million) in a share issue. The funds will be used to repay debt and finance new projects.

The company sold 51,340,000 ordinary shares to institutional investors and 6,160,000 shares to retail investors at £0.10 each (~$0.13) — representing 12% of the current equity.

Initially the firm targeted an issue of 47,750,000 shares to raise £4.78 million (~$6.18 million), but strong demand allowed the offer to be upsized.

The shares were issued at a 14% discount to the 30-trading-day VWAP and about 26% to the 18 July close.

The expansion of supply at a price below market value knocked about 20.5% off Argo Blockchain’s market capitalization. Since the start of the year, the company’s shares have risen 48%.

Argo ended 2022 with a net loss of $240 million. In January the firm avoided delisting on Nasdaq, where it has been trading since 2021.

In the first quarter of 2023, the company generated revenue of $11.4 million — up 15% from the previous period.

Interim CEO Seif El-Bakli noted that the firm cut operating costs quarter-on-quarter by about 70%. After the completion of the sale for $65 million of the flagship Helios data centre in Texas, Galaxy Digital’s equipment park located there gained access to cheaper electricity.

Throughout the quarter, Argo received and installed a batch of BlockMiner miners from ePIC on Intel chips with a total hash rate of 300 PH/s. The company expects that completing deliveries and deploying the entire ordered volume of devices will push its compute power to roughly 2.8 EH/s.