Core Scientific Set to Emerge from Bankruptcy with NASDAQ Relisting Plan

CEO Adam Sullivan expresses excitement for the company's recovery and outlines a post-emergence strategy for growth.

Core Scientific Set to Emerge from Bankruptcy with NASDAQ Relisting Plan
Core Scientific Set to Emerge from Bankruptcy with NASDAQ Relisting Plan

Over the course of the following month, Core Scientific, which is one of the most significant Bitcoin miners in the United States, would emerge from bankruptcy procedures.

As stated in the release made on December 21st, the company has reached an agreement with its shareholders about the distribution of convertible notes and shares by the middle of January 2024 and the subsequent relisting of the company on the NASDAQ exchange.

The Chief Executive Officer of the company, Adam Sullivan, stated his excitement about the company’s recovery, claiming “a post-emergence pathway to de-leverage our balance sheet and a plan for continued growth in 2024 and beyond.”

As a result of the deal, shareholders of Core Scientific will be given new shares that have been swapped at a ratio of 25:1, which will reward them with $1.08 for each share that was held before the exchange. On the other hand, noteholders will receive $1.201 for every $1 of face value for notes with an August maturity date and $1.628 for every $1 of face value for convertible notes that are due in April.

Core Scientific completed a special purpose acquisition company (SPAC) transaction worth $4.3 billion in July 2021, which allowed the business to go public. The stock of Core Scientific was valued at ten dollars before that moment.

As a result of a confluence of factors, including the crypto winter, rising energy prices, increased mining difficulty, and toxic debt that had been loaned to the cryptocurrency company Celsius, Core Scientific filed for bankruptcy in December 2022.

Core Scientific will be left with $709 million in net debt and $791 million in shareholder’s equity after the plan takes effect in January. There is only $46 million in debt that will mature through the year 2025.

During the time that the company was going through the process of filing for bankruptcy, it entered into a contract with Bitmain, a maker of Bitcoin application-specific integrated circuits (ASICs), for 27,000 mining rigs that was worth $77 million in cash and shares.

The company currently possesses more than 199,000 ASICs and mines approximately 32 bitcoins on its own every single day.