Bitcoin miner Stronghold Digital Mining (SDIG) has begun exploring strategic alternatives that could include a potential sale of the company.
“The Company is considering a wide range of alternatives to maximize shareholder value, including, but not limited to, the sale of all or part of the Company, or another strategic transaction involving part or all of the assets of the company,” the miner said in a press release on Thursday.
Stronghold, the company that turns piles of coal waste into energy to mine bitcoin, said the move comes as there is a “valuation dislocation” of the stock compared to its other mining competitors in the market .
“Stronghold’s Board of Directors and management team are committed to maximizing value for our shareholders and, to that end, have initiated a comprehensive and thorough review of strategic alternatives,” said Greg Beard, Chairman and CEO. General of Stronghold.
The company hired Cohen and Company Capital Markets as financial advisors and said no specific timeline has been set for completing the review. Shares rose nearly 7% Thursday in pre-market trading.
The stock has fallen 62% this year, while peers such as Riot Platforms (RIOT) and Marathon Digital (MARA) have fallen about 40%. Bitcoin is up 39% so far this year.
Mergers and acquisitions have been touted as one of the areas that will gain momentum after the halving, which has made the mining landscape more competitive for miners since rewards have been halved.
There has already been an uptick in mergers and acquisitions in the mining sector, as mining companies with stronger balance sheets have started buying up assets that trade at low valuations.
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