Cryptomining firm Bitfarms is to acquire Stronghold Digital Mining.

The companies this week entered into a definitive merger agreement under which Bitfarms will acquire Stronghold in a stock-for-stock merger transaction.

The deal is valued at approximately $125 million equity value plus the assumption of debt valued at approximately $50 million. The deal is expected to close in the first quarter of 2025.

Founded in 2017, Bitfarms has 12 operating Bitcoin data centers and two under development across Canada, the United States, Paraguay, and Argentina. Its portfolio totals 310MW.

The company owns and operates eight facilities in Canada totaling 158MW; one in the US in Washington totaling 17.5MW with another 120MW site in development in Sharon, Pennsylvania; a 54MW site in Río Cuarto, Argentina; and three sites in Paraguay totaling 80MW.

Stronghold has cryptomining operations at two wholly owned and operated power plants in Pennsylvania; Scrubgrass Plant and Panther Creek Plant.

Stronghold owns more than 750 acres of land with options on over 1,100 additional acres at the two sites, and currently has 165MW of current nameplate generated power capacity, with expansion potential.

The Scrubgrass facility, located in Scrubgrass Township, Venango County, totals 85MW. The Panther Creek site in Nesquehoning, Carbon County, offers 80MW. The latter site was acquired in 2021.

Both sites generate power from coal refuse, a waste byproduct of legacy coal mining operations. Scrubgrass opened in 1993, burning the coal waste to make electricity. In the 1990s, efficient fluidized bed combustion began to make energy from waste materials and other "difficult" fuels economic, and there are now 12 such "co-generation" plants in Pennsylvania.

The companies said the deal could add up to 307MW of power capacity and is expected to put Bitfarms on track to increase its energy portfolio to over 950MW by year-end 2025.

Stronghold CEO, Gregory Beard, said: “We have been in conversation with Bitfarms for a long time. Having received and reviewed numerous bids in our Strategic Alternatives Review process, we believe that we found the ideal partner.”

Ben Gagnon, Bitfarms CEO, added: “After three years of ongoing discussions, I am proud to announce this transformative acquisition, which is a decisive step in securing a strong future for Bitfarms. With this transaction, we expect to expand and rebalance our energy portfolio to 950MW with nearly 50 percent in the US by the end of 2025 and have visibility on multi-year expansion capacity up to 1.6 GW.”

Gagnon added that Stronghold’s carbon capture projects have the potential to capture more than 60,000 tons of carbon dioxide annually, providing Bitfarms additional revenue.

Gagnon was appointed Bitfarms CEO in July, replacing L. Geoffrey Morphy. Gagnon was previously the company’s chief mining officer.

The deal comes as Bitfarms is fighting off being acquired by another crypto firm. In May, Riot Platforms made an unsolicited offer to acquire Bitfarms for around $950m. Bitfarms later described the offer as a ‘low-ball bid that significantly undervalued’ the company and said Riot was attempting to disrupt its alternatives review process.

“It is a thinly veiled ploy to achieve Riot’s own self-serving agenda and attempt to acquire Bitfarms at a discounted price,” Bitfarms said.

Having withdrawn the buyout offer, Riot has instead been upping its ownership stake in Bitfarms amid a hostile takeover of the company, and now owns around 20 percent of Bitfarms. Riot had been looking to remove existing Bitfarms directors, and this month company founder Nicolas Bonta left.

Formerly known as Riot Blockchain, Riot operates sites in Rockdale and Corsicana in Texas and another in Kentucky; it has 1.2GW of capacity in operation and another 800MW in development. The company acquired Block Mining in Kentucky in July.

Gryphon acquires gas flare mining operations

Gryphon Digital Mining, Inc., a Bitcoin mining company, has entered into an agreement to acquire up to 2.9 MW of gas flare Bitcoin mining operations in Louisana.

Founded in 2021, the company currently operates a hydro-powered site in Massena, New York.