Investment company Global Care Capital (HLTH) has entered into a letter of intent for the acquisition of ASIC Power Company.
ASIC Power is a cryptocurrency business, which combines ASIC chips with royalty streaming contracts. The company plans to acquire all issued and outstanding securities in the capital of ASIC, in exchange for securities of Global Care.
In consideration for the acquisition, Global Care will issue 100 million of its common shares to ASIC shareholders, at a price of 9.5 cents per share. This will value the acquisition transaction at approximately C$9.5 million.
The company expects that the acquisition will provide its shareholders with exposure to cryptocurrency mining infrastructure and the financing market. Global Care’s CEO, Alex Somjen, commented on the company’s foray into the cryptocurrency industry.
“Traditionally, cryptocurrency mining expansion has been funded by dilutive equity or large debt deals that are secured by the underlying assets. Little innovation has been made to accommodate the unique properties of this emerging ecosystem,” he said.
“With our acquisition of ASIC, we believe we can help supercharge some of the much-needed computing power in a capital efficient manner to power the next wave of bitcoin and other cryptocurrencies,” he added.
The terms set out in the letter of intent are subject to Global Care Capital and ASIC entering a definitive agreement for the transaction. This must occur by January 31, 2021, or another date agreed upon by both parties.
Global Care Capital is down 20.83 per cent and is trading for 9.5 cents per share, as of 10:58am EST.