Core Scientific gets Court OK to emerge from bankruptcy
Core Scientific, a blockchain infrastructure and hosting provider, is getting set to exit bankruptcy after a Texas court approved its reorganization plan on Tuesday.
The latest decision by the US Bankruptcy Court for the Southern District of Texas gives the firm a path to emerge from Chapter 11 bankruptcy and re-list its shares on the Nasdaq later this month, a spokesperson told Blockworks in an email.
Core Scientific filed for bankruptcy in December 2022 after it had trouble generating enough revenue to cover debt obligations. The firm was among the companies in the sector that took out high-interest loans to fund growth amid the 2021 bull market.
Read more: Crashing prices expose bitcoin mining industry’s addiction to leverage
The reorganization plan called for “100% recovery to all creditors…and significant recovery to existing equity holders,” according to court documents. The plan includes the equitization of about $400 million in secured and unsecured claims, as well as a decrease in annual debt service by roughly $60 million.
The company had secured financing via an “oversubscribed” $55 million equity rights offering last week.
Core Scientific seeks to emerge from bankruptcy on Jan. 23 and re-list its shares on Nasdaq the following day, the filing notes.
“With demand for bitcoin and high-value compute continuing to rise, we look forward to creating value for our shareholders as we execute our growth plan, de-lever our balance sheet and deliver superior efficiency at scale,” Core Scientific CEO Adam Sullivan said in a Tuesday statement.
Core Scientific continued to make deals as it navigated bankruptcy proceedings. Bitmain agreed to invest $53 million in the miner in September, alongside a new hosting agreement.
The company operated roughly 209,000 bitcoin miners — amounting to an energized hash rate of 23.2 exahashes per second (EH/s) — across data centers in Texas, Georgia, Kentucky, North Carolina and North Dakota, as of Dec. 31. Core Scientific mined 1,177 BTC in December 2023.
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