Madison Group Acquires Digital Currency Mining Business
Madison Holdings (8057.HK) announced on 26 April 2018 that Madison Future Games Limited, a wholly-owned subsidiary of Madison Group, agreed to acquire 51% of the entire issued share capital of Digitals Limited, a subsidiary of Diginex Global Limited, for the total consideration of US$60,000,000, which will be settled in the following manner:
(i) As to US$10,000,000 shall be paid in cash to Diginex Global Limited as the Refundable Deposit on the date of the Acquisition Agreement;
(ii) The balance of US$50,000,000 shall be satisfied by the Company allotting and issuing 213,252,717 Consideration Shares at the Issue Price (approximately HK$1.84 per share, the amount of the consideration shares issued represents approximately 4.98% of the total shares issued).
The Target Company is principally engaged in virtual currency mining. The Target Company currently has 2.2 megawatts (“MW”) of datacenters under management located across Asia and Europe. The entity mines predominately Ethereum (ETH) using high performance graphics processing units (“GPU”) mining rigs. At present virtual currencies with a proof of work consensus mechanism that requires mining represents more than 75% of the total market capitalization for virtual-assets. As interest in trading and the adoption of virtual currencies continues to grow, there will be an increased demand for mining facilities to ensure more efficient transaction validation through their underlying blockchain networks. The Target Company will be adding more MW in their data centre in Europe which has low-cost and renewable energy sources.
After the completion of the acquisition, Madison Holdings plans to expand the capacity of the data centre to at least 150 MW which will be one of the biggest virtual currency mining centre throughout the world.