Arkon Energy, an infrastructure provider for data centers powered entirely by renewable resources, has announced that it has successfully raised $28 million. The company, which is based in Australia, has also successfully completed the acquisition of Hydrokraft AS, which is a leading data center in Norway that is based on renewable energy.
The acquisition of Hydrokraft is one step toward the ambitious goal of developing a platform for green Bitcoin mining that is vertically integrated, possesses electricity sovereignty, reaps the benefits of regional diversification, and has a strong bank sheet. Because of this, Arkon will be able to steer clear of the traps that have prevented other top actors in the field from reaching their full potential.
Commenting on the acquisition, Arkon CEO Josh Payne said: “The current market climate, with low prices for bitcoin and mining equipment, offers a compelling opportunity to take advantage of our unique profitability and access to growth capital. We are excited to have completed this transaction and we look forward to executing several additional growth opportunities in the near future.”
Enhancing Bitcoin Mining With Renewable Power
Bitcoin is mined with electricity derived from renewable sources by Arkon Energy. Its environmentally responsible data centers make use of surplus renewable power in electricity markets that are in short supply, which helps to maintain one of the industry’s most competitively low average production costs. In addition, the business makes use of cutting-edge immersion cooling technology to ensure that its many pieces of machinery operate at peak performance.
CEO Josh Payne and COO Nathan Townsend, both of whom have substantial experience in the operation of Bitcoin, capital markets, and energy infrastructure, respectively, are guiding the company as its leaders. They are supported by a team of seasoned executives that have substantial experience across a variety of industries, including Bitcoin mining and the building of energy infrastructure.
With a present working capacity of 30 MW and a maximum capacity of 60 MW, Hydrokraft is one of the most powerful data centers in all of Europe. The facility was finished in 2021 and uses electricity that is generated from hydropower which is both sustainable and cost-effective. In order to make full use of the capacity of the facility, Arkon intends to launch an immediate construction project to build out incremental infrastructure.
Barry Kupferberg, the Managing Partner of Barkers Point Capital Advisors which helped finance the deal, added: “In a period in which the largest bitcoin miners in the world are struggling with high costs and over-leveraged balance sheets, the ability of Arkon Energy to attract capital highlights its unique value proposition. Distressed cycles produce winners and losers and Arkon is well positioned to be a winner.”
Arkon Energy was able to successfully complete the acquisition thanks to the utilization of both senior debt and equity financing. Blue Sky Capital acted as the leader of the equity investors, which also included Kestrel 0x1 (the lead investors from the previous round), Shima Capital, and a number of other organizations. Partners from Blue Sky, Kestrel 0x1, and Barkers Point Capital Advisors will be joining the main board as a result of this transaction.
Offering Optimal Solutions Amid The Market Downturn
The present market slump has had a negative impact on mining businesses that did not construct enough runway prior to the market downturn. Their predicament has become even more difficult as a result of their incurring an exorbitant amount of debt by borrowing against future profits. As a direct consequence of this, a great number of mining businesses have been compelled to either completely cease operations or significantly reduce their workforce.
Because it has always placed a high priority on maintaining a financial model with a modest amount of debt, Arkon Energy is in an excellent position to capitalize on the economic outlook, which has caused its rivals to struggle to maintain their positions in the market. Arkon is able to increase its market share by purchasing foreclosed properties and businesses due to the strength of its balance sheet, its low level of debt, and its low-cost base for power.
Arkon Energy was established in 2019 and seeks to fundamentally improve the commercial viability of businesses that are involved in the development or ownership of renewable power assets. Bitcoin mining is how it is accomplished, and it does this by enhancing the economics of electricity-producing projects. Renewable power assets are frequently situated in energy grids that have limited capacity, and as a result, they earn low returns.
This is especially true during specific times of the day when there is an abundance of power available. Arkon Energy is able to provide these customers with lucrative revenue opportunities while also improving the reliability of the grid’s sustainable generation by building mining activities that are extremely efficient and directly utilize excess electricity.