Argo nets $7.5 million in oversubscribed share sale, plans to pay off debt

Crypto mining firm Argo Blockchain has raised £5.75 million (around $7.5 million) from a concurrent institutional and retail share sale, oversubscribed by both new and existing shareholders.

Argo placed 51,340,000 new ordinary shares with institutional investors at 10 pence per share, raising approximately £5.13 million ($6.64 million). The crypto miner also raised £616,000 ($797,000) through retail investors who subscribed for 6,160,000 new ordinary shares at the same price, according to a London Stock Exchange announcement.

Argo had targeted a minimum of 47,750,000 new ordinary shares to raise £4.78 million ($6.18 million), according to a previous announcement.

The shares were issued at a discount of around 14% to the 30 trading day volume-weighted average price and approximately 26% to the closing mid-price on July 18. The new shares represent roughly 12% of its existing issued ordinary share capital. The crypto miner plans to use the funds to pay down outstanding debt and pursue growth projects, according to the announcement.

Argo has submitted applications to the Financial Conduct Authority and the London Stock Exchange for the admission of the new shares, expected to become effective by July 24.

Argo stock is down over 20% following the news.

Avoiding bankruptcy

In December, Argo said it accidentally published drafts implying it had filed for Chapter 11 bankruptcy protection but was actually trying to avoid that fate by selling assets. Later that month, Argo confirmed it had agreed to sell its Helios mining facility to Mike Novogratz’s Galaxy Digital for $65 million. Argo also received a $35 million loan from the company.