One of the leading providers of Bitcoin BTC/USD mining hardware and blockchain software and services is going public in a SPAC merger.
The SPAC Deal: Cipher Mining is going public is a SPAC merger with Good Works Acquisition Corp GWAC, valuing the company at an enterprise of $2 billion. The company was valued at $1 billion in its last fundraising round in 2018.
The deal includes a $425 million PIPE backed by Fidelity and Counterpoint Global, a Morgan Stanley MS unit.
Cipher Mining parent company Bitfury is investing $50 million in the PIPE as a deal structured as credit for future purchases of operational services or equipment for Cipher.
The deal is expected to close in the second quarter of 2021. Current Good Works Acquisition Corp shareholders will own 6% of the company after merger.
About Cipher Mining: Since its inception in 2011, Cipher Mining has mined over 600,000 bitcoin.
“As the projected largest scale mining platform in the U.S., Cipher will provide investors the opportunity to invest in the Bitcoin industry via a leading mining company operating in a highly transparent and well-regulated environment,” the company said.
Growth Ahead: Cipher Mining said it will have mining capacity of 745 MW by the end of 2025 with an industry-leading cost of energy of 2.7 cents per kWh.
Cipher Mining is planning to add additional U.S. data centers in the fourth quarter of 2021 to second quarter of 2022 for its next wave of expansion that will add 445 MW of power capacity. From 2023 to 2025, the company is expected to add 300 MW of power capacity.
By 2025, Cipher Mining could be the leading bitcoin mining operator with an estimated 9% market share.
The company lists in its presentation that additional expansion could come in financial services, ETFs and having a Mining-as-a-Service business for customers.
Peer Companies: Many bitcoin mining-related stocks have seen large share increases over the last two years. Here is a look at how Cipher will stack up versus its peers.
Cipher Mining: 745 MW by 2025
Argo Blockchain PLC ARBKF: 235 MW by 2025
Marathon Digital Holdings Inc MARA: 335 MW by 2025
Bitfarms Ltd BFARF: 468 MW by 2025
Riot Blockchain Inc RIOT: 120 MW by 2025
Cipher Mining’s 2.7 centers per kWh will be lower than its peers that range from 2.8 cents to 4.0 cents per kWh, according to the presentation.
Financials: Cipher Mining lists estimated revenue of $6 million for fiscal 2021 and $350 million in fiscal 2022. With additional capacity in the years after, the revenue estimates improve to $652 million in fiscal 2023, $714 million in fiscal 2024 and $1 billion in fiscal 2015.
Price Action: Shares of Good Works Acquisition are up 14% to $11.42.
(Photo: Andre Francois McKenzie via Unsplash)
Visit Benzinga's Crypto Homepage - 1,000,000+ depend on Benzinga Crypto every month
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.