DRESDEN, NY – Greenidge Generation Holdings Inc. (NASDAQ:GREE), a cryptocurrency data center and power generation company, today announced an investment agreement with Armistice Capital totaling $6 million, aimed at bolstering the company's company growth.
The investment is expected to support Greenidge's expansion into new low-cost energy hubs, enhance its bitcoin mining capabilities, further develop its engineering, procurement and construction management (EPCM) business, as well as fund new data centers/AI infrastructure.
Greenidge CEO Jordan Kovler said Armistice Capital's capital injection underscores the company's continued transformation and growth efforts.
Under the agreement, Armistice Capital will initially invest $6 million in exchange for 1,260,505 pre-funded shares and warrants, with each share priced at $4.76. Additionally, Armistice will receive warrants to purchase an additional 1,260,505 shares at a total price of $6.62 million, or $5.25 per share.
The investment follows Greenidge's recent announcement of its first profitable quarter in two years. The company reported preliminary financial and operating results for the fourth quarter of 2023, with net income ranging from $1.4 million to $2.4 million, adjusted EBITDA between $1.6 million and $2.6 million and earnings per share of $0. 18 at $0.32. In 2023, Greenidge also reduced its debt by $85.3 million, which represented more than 54% of its total debt.
Greenidge Generation Holdings Inc. focuses on vertically integrated power generation and specializes in cryptocurrency mining and related infrastructure development.
Details provided are based on a press release from Greenidge Generation Holdings Inc.
InvestingPro Insights
As Greenidge Generation Holdings Inc. (NASDAQ:GREE) secures a $6 million investment from Armistice Capital to enhance its growth strategy, it is important to consider the company's financial health and market performance. According to data from InvestingPro, Greenidge has a market capitalization of approximately $37.98 million. Despite a significant performance over the past week of 43.81%, the company's share price has seen substantial volatility, which is reflected in a high price volatility score from InvestingPro.
InvestingPro's advice highlights the company's challenges, such as its significant debt load and a cash burn that is rapidly depleting its reserves. Additionally, the company's short-term obligations exceed its liquid assets, which may pose liquidity risks. InvestingPro analysts predict the company will be profitable this year, which could be a turning point for Greenidge as it looks to leverage fresh capital for expansion.
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