HIVE Blockchain Announces Strategic Partnership and Share Swap Agreement with Argo Blockchain

13 May 2019
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Zug, Switzerland and Vancouver, Canada – HIVE Blockchain Technologies Ltd. (TSX.V:HIVE) (OTCQX:HVBTF) (the “Company” or “HIVE”) is pleased to announce that it has entered a non-binding letter of intent and heads of terms and a share swap agreement with Argo Blockchain PLC (LSE:ARB) (“Argo”) to explore a proposed strategic partnership to create the world’s largest business-to-business mining service provider aimed at large-scale enterprise and institutional customers. The proposed strategic partnership will enable all miners to benefit from the combination of the two groups’ existing mining capacity, including part of HIVE’s equivalent mining capacity of 45 megawatts (“MW”) and Argo’s 10.5MW capacity and presents a significant opportunity to service strategic institutional clients that require Mining-as-a-Service (MaaS) infrastructure to mine virgin coins from safe jurisdictions like North America and Europe.

“We are excited about this strategic partnership and our analysis indicates that Argo is significantly undervalued,” said Frank Holmes, Interim Executive Chairman and Interim CEO. “They have a healthy cash position with more than £16 million, as of December 31, 2018, and since then Argo has deployed some of the most efficient ASIC chips to expand Bitcoin operations while cryptocurrencies continue to rebound from lows seen at the beginning of 2019. In our view, the crypto market is ready for a mining solution focused on enterprise customers that require accountability and transparency. Our combination of scale, software and teams will be transformational in this growing market.”

“This deal makes strategic sense and demonstrates the intrinsic value of our business, our vision and existing investment,” added Jonathan Bixby, Executive Chairman of Argo. “The alliance is transformational for Argo and will deliver long-term and sustainable fiat-based revenue streams.”

This proposed strategic partnership will leverage the strengths of Argo’s Canadian infrastructure including software, capacity, team, competitive electricity prices in Quebec and hardware costs and HIVE’s industrial scale production capacity in Iceland and Sweden, its assets located in Norway, and HIVE’s deep experience and expertise in the cryptocurrency mining and blockchain ecosystem.

As part of the agreement, HIVE and Argo are considering a share swap arrangement, by which Argo will receive approximately 5% of HIVE’s outstanding share capital in exchange for approximately 15% of Argo’s outstanding share capital. The transaction does not involve any cash payments by either side and is expected to close on May 30, 2019 subject to among other customary conditions, negotiation and execution of binding agreements, both parties completing satisfactory due diligence, obtaining their respective board of directors’ approvals, and to completing an independent external valuation of HIVE.

 

About Argo Blockchain PLC

Argo Blockchain plc is a global data centre management business that provides a flexible platform for the mining of leading cryptocurrencies. Argo is headquartered in London, UK and operates state-of-the art data centres in Quebec, Canada. The Company's shares are listed on the main market of London Stock Exchange under the ticker: ARB

 

About HIVE Blockchain Technologies Ltd.

HIVE Blockchain Technologies Ltd. is a growth oriented, TSX.V-listed company building a bridge from the blockchain sector to traditional capital markets. HIVE is strategically partnered with Genesis Mining Ltd. to build the next generation of blockchain infrastructure. HIVE owns state-of-the-art GPU-based digital currency mining facilities in Iceland and Sweden, which produce newly minted digital currencies like Ethereum continuously as well as cloud-based ASIC-based capacity which produces newly minted digital currencies like Bitcoin. Our deployments provide shareholders with exposure to the operating margins of digital currency mining as well as a growing portfolio of crypto-coins.

For more information and to register to HIVE’s mailing list, please visit www.HIVEblockchain.com. Follow @HIVEblockchain on Twitter and subscribe to HIVE’s YouTube channel.

 

On Behalf of HIVE Blockchain Technologies Ltd.

“Frank Holmes”

Interim Executive Chairman

 

For further information please contact:

Frank Holmes

Tel: (604) 664-1078

 

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

 

Forward-Looking Information

Except for the statements of historical fact, this news release contains “forward-looking information” within the meaning of the applicable Canadian securities legislation that is based on expectations, estimates and projections as at the date of this news release. “Forward-looking information” in this news release includes information about the proposed transaction with Argo and, including potential completion date and quantum of share swap arrangement; the proposed strategic partnership with Argo and the potential outcomes of that partnership; the long term growth of the Company; the business goals and objectives of the Company, and other forward-looking information includes but is not limited to information concerning the intentions, plans and future actions of the parties to the transactions described herein and the terms thereon.

Factors that could cause actual results to differ materially from those described in such forward-looking information include, but are not limited to, the Company may not receive approval to complete the transaction with Argo as contemplated or at all; the Company’s ability to source and service strategic institutional clients; the digital currency market; the Company’s ability to successfully mine digital currency; the Company may not be able to profitably liquidate its current digital currency inventory, or at all; a decline in digital currency prices may have a significant negative impact on the Company’s operations; the volatility of digital currency prices; and other related risks as more fully set out in the Filing Statement of the Company dated and other documents disclosed under the Company’s filings at www.sedar.com.

The forward-looking information in this news release reflects the current expectations, assumptions and/or beliefs of the Company based on information currently available to the Company. In connection with the forward-looking information contained in this news release, the Company has made assumptions about the Company’s ability to complete the transaction with Argo; the ongoing strategic partnership with Argo; the Company’s ability to source and service strategic institutional clients; the Company’s ability to profitably liquidate its digital currency inventory as required; historical prices of digital currencies and the ability of the Company to mine digital currencies will be consistent with historical prices; and there will be no regulation or law that will prevent the Company from operating its business. The Company has also assumed that no significant events occur outside of the Company's normal course of business. Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein