Core Scientific wins court approval to enact reorganization plan, exit bankruptcy
The Bitcoin mining company expects to pay its debt in full.
The Bitcoin mining firm Core Scientific announced on Jan. 16 that it has obtained court approval to proceed with its reorganization plan.
Core Scientific noted that this reorganization plan will allow it to emerge from Chapter 11 bankruptcy proceedings in the coming days.
Adam Sullivan, Core Scientific’s CEO, said:
“Today’s plan confirmation is a defining moment in our reorganization; we’re poised to emerge by the end of this month as an even stronger company, with a highly motivated team that is aligned for success.”
Sullivan noted that demand for Bitcoin and “high-value compute” is rising and said that the company aims to create value for shareholders amidst that demand.
The press release added that the plan will see shareholders receive shares of Core Scientific’s new common stock and warrants, which constitute about 60% of the company’s new equity. The release also stated that Core Scientific’s existing debt is expected to be paid in full with the execution of the plan, marking a reduction of $1 billion from its debt balance before the reorganization plan.
Bloomberg suggested in a separate report that the plan will eliminate $400 million in debt from Core Scientific’s balance sheet. Bloomberg also indicated that the firm’s precise re-listing date on Nasdaq is Jan. 24, 2024.
Core Scientific was in bankruptcy for one year
Core Scientific filed for Chapter 11 bankruptcy in December 2022 but continued to operate throughout the bankruptcy process.
Notably, the company secured a multi-million dollar loan from BlackRock and other creditors shortly after its bankruptcy filing in order to continue its activities.
More recently, Core Scientific reached an expansion deal with Bitmain in September 2023. That agreement that saw Bitmain invest $54 million in Core Scientific and provide the company with 27,000 Bitcoin mining devices.
Core Scientific stock (CORZQ) is currently worth $1.18, down 14.49% today. The stock’s price is considerably higher than it was throughout most of 2023, but is considerably lower than its all-time high of $14.32 on Nov. 19, 2021.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
What Are the Whales Doing Right Now in Cryptocurrencies and What Are Small Investors Doing? The Data is Clear
An analysis published by cryptocurrency analysis company Alphractal examined the behavior of whales and small investors.
BREAKING: FED Publishes Critical Beige Book Report – Here’s All You Need to Know
The FED has published the important Beige Book document, which is closely followed by cryptocurrency investors. Here are the details.
Another Positive News Came From Germany: One of the Largest Stock Exchanges Announces Bitcoin and Cryptocurrency Development
Boerse Stuttgart, one of Germany's leading stock exchanges, spoke about the Bitcoin and cryptocurrency service it provides in its statement.
Tron Founder Justin Sun Unveils Controversial New Product: “We’re Doing It Because We Have Too Much Money”
Tron founder Justin Sun announced his controversial new product to users in his statement.