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Hive Blockchain Technologies Ltd
Symbol HIVE
Shares Issued 346,583,064
Close 2021-02-24 C$ 5.35
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Hive Blockchain to acquire 50 MW data centre in N.B.

2021-02-25 02:12 ET - News Release

Mr. Frank Holmes reports

HIVE BLOCKCHAIN CONFIRMS THE ACQUISITION OF A 50 MW DATA CENTRE WITH THE SIGNING OF DEFINITIVE AGREEMENT WITH GPU.ONE

Hive Blockchain Technologies Ltd. has signed a share purchase agreement with GPU.One Holding Inc. (GPU One) to expand Hive's Canadian footprint through the purchase of 100 per cent of the shares of GPU Atlantic Inc. This acquisition will build long-term assets on the company's balance sheet and complements Hive's ESG (environmental, social and corporate governance) strategy to only mine coins on the cloud from sources of low-cost surplus green energy. Further, GPU One key management with many years of deep data centre experiences will be joining the Hive team.

With this acquisition Hive, through its subsidiary, GPU Atlantic, will be the owner of a 50-megawatt (MW) substation and a data centre campus in Grand Falls, N.B., with a dedicated crypto currency mining operation with access to 50 megawatts of low-cost green power, for a total purchase price of approximately $25.0-million. Pursuant to the agreement, Hive will satisfy the purchase price through the issuance of 4.6 million common shares to GPU One and 400,000 Hive shares to GPU One's minority partner, at a deemed price of $5 per Hive share. Of the 4.6 million Hive shares to be issued to GPU One pursuant to the acquisition, one million Hive shares will be allocated to a holdback and earnout to GPU One upon delivery of certain earnout conditions.

"This is an important strategic acquisition for Hive that diversifies our business significantly and adds one of the industry's top data centre operators to our ranks at an opportune time and at an attractive valuation for our shareholders," said Frank Holmes, executive chairman of Hive. "The acquisition provides us with full ownership of a state-of-the-art and operational bitcoin mining data centre ready to deploy our incoming next-generation bitcoin mining hardware with access to some of the lowest electricity costs in the industry.

"Additionally, this acquisition further enables Hive to continue in its objective of having control of its destiny, including significant capacity for expansion and flexibility for our future operations. We now have a 50-megawatt data centre campus to build up and a home for our new-generation bitcoin miners. We are also very excited about integrating new members of the GPU One team into our ranks and deploying their in-house mining management software into our operations on a global scale," added Mr. Holmes.

The acquisition will again more than double Hive's total available power capacity globally to approximately 100 megawatts, placing it among the largest of any publicly listed crypto currency miners, and provide significant diversification to the company's business both geographically and by blockchain network.

The fully operational, state-of-the-art facility features a 50-megawatt substation, two fully operational data centre buildings offering a combined 30 megawatts of ready-to-plug space, electrical infrastructure that is unique to crypto currency mining, and a highly skilled technical team of executive and operational staff. Due to the facility's low electricity prices, the company's miners are expected to generate positive gross mining margins under current market conditions.

The acquisition has been approved by Hive's board of directors, and the board of directors and the shareholders of GPU One and its minority shareholder, and remains subject to customary closing conditions, including receipt of regulatory approvals. The acquisition is expected to close in the next three weeks.

Hive is currently one of the world's largest public miners on the ethereum blockchain and this acquisition places Hive among the world's larger publicly listed miners of bitcoin. The newly acquired bitcoin mining facility in New Brunswick diversifies the company's existing portfolio, which includes a facility in Quebec, and ethereum-focused GPU mining operations in Sweden and Iceland.

Hive welcomes its new employees under GPU Atlantic

Hive is pleased to announce that, as part of the acquisition, it will retain key employees of GPU One to lead GPU Atlantic.

Gabriel Ibghy

Mr. Ibghy is the chief executive officer and director of legal at GPU Atlantic. He is a practising attorney and MBA, and has extensive experience in the field of crypto currency mining, data centre construction, operations and management. He has developed international experience in complex and challenging environments, and has immersed himself into the world of crypto currency, and together with the team at GPU One, has been actively involved in the growing of the industry's premier data centre operators and managers. He now brings his experience to Hive and will continue to develop its growth within this fast-paced industry.

Vladimir Plessovskikh

Mr. Plessovskikh proudly maintains a reputation as senior partner at several large technology companies. Having worked at Transforce, a public company, and also as an accounting professional at Ernst and Young, he has a deep understanding of the technology sector, its present needs and future direction. Mr. Plessovskikh now brings his experience and expertise to add value to the Hive management team, and will act as chief financial officer of GPU Atlantic.

William (Bill) Gray

Mr. Gray has served as chief technology officer of GPU One since its inception and has been responsible for the successful development and deployment of GPU One's internal in-house mining management software systems. Previously, he served as chief technology officer for Mplore LLC, Silicon Valley's mobile ad delivery platform for public companies, including Sprint, Nextel and T-Mobile. He is a global network and software architecture expert. He has been involved in co-location operations since 2010. Mr. Gray will serve as CTO to GPU Atlantic, and will work with Hive to develop new tools and software for Hive's global network of data centres.

Iggy Lai

Mr. Lai has served as vice-president of business development with GPU One. He brings 15 years of experience in business development. He has worked at various Fortune 500 tech companies, including Symantec and Best Buy for Business, and has founded his own tech venture. He has established himself as one of Canada's leading providers of information technology equipment. Mr. Lai is one of the most well-respected business development professionals in the crypto space, and has successfully assisted GPU One and its customers with over $50-million worth of mining equipment procurement. Hive is very excited to welcome Mr. Lai to its team as he will take on the role of VP of strategic partnerships.

About GPU.One Holding Inc.

GPU One is one of the industry's premier data centre operators and managers. Winner of Bitmain's Top 10 Mining Farms in the World, it is a privately held venture-backed and institution-backed data centre owner and operator.

About GPU Atlantic Inc.

GPU Atlantic has recently constructed a new and state-of-the-art 50-megawatt data centre campus located in New Brunswick, Canada. The campus contains its own private 50-megawatt substation along with two fully operational data centre facilities ready to host up to 30 megawatts of Hive's new-generation mining equipment. The campus also provides for space, electrical capacity and materials to continue its pursuit of growth within the existing infrastructure with a third data centre building with a capacity of 20 megawatts planned for delivery and ready for occupancy in calendar Q3 2021. GPU Atlantic's in-house software is ahead of the competition, and provides seamless and remote control of its facilities and mining equipment under management.

About Hive Blockchain Technologies Ltd.

Hive is a growth-oriented, TSX Venture Exchange-listed company building a bridge from the blockchain sector to traditional capital markets. Hive owns state-of-the-art, green-energy-powered data centre facilities in Canada, Sweden and Iceland, which produce newly minted digital currencies like bitcoin and ethereum continuously on the cloud. The company's deployments provide shareholders with exposure to the operating margins of digital currency mining as well as a portfolio of crypto coins.

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