"Global settlement removes key hurdles for our expected exit from Chapter 11 in January," wrote Core Scientific CEO Adam Sullivan.
The company announced on December 21 that it has reached a major agreement with shareholders regarding the distribution of convertible notes and shares by mid-January 2024, after which it will relist on the NASDAQ exchange. Adam Sullivan, the company's CEO, expressed his excitement about the company's return and outlined the path for debt reduction and a growth plan for 2024 and beyond.
Under the agreement, Core Scientific shareholders will receive new shares at a ratio of 25:1, resulting in $1.08 per share before the exchange. Note holders, meanwhile, will receive $1.628 for every $1 nominal value of convertible notes due in April, and $1.201 for the nominal value of $1 for notes with an August maturity date.
In July 2021, Core Scientific entered the stock market with a value of $4.3 billion through a special acquisition company (SPAC). At that time, the company's shares were priced at $10. Shortly thereafter, a combination of negative cryptocurrency market trends, rising energy costs, increased mining difficulty, and bad debts associated with Celsius led Core Scientific to declare bankruptcy by December 2022.
According to a previous report, Core Scientific will inherit $709 million in net debt and $791 million in equity after the plan becomes effective in January. By 2025, the debt will be reduced to only $46 million. During the bankruptcy period, the company entered into a $77 million cash and equity agreement with bitcoin integrated circuit manufacturer #Bitmain for 27,000 mining devices. Currently, the company owns over 199,000 ASICs and independently mines approximately 32 bitcoins per day.
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