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Cango Inc. Completes Cash-Settled Acquisitions of Crypto Mining Assets

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Cango Inc. (NYSE: CANG) has completed the cash-settled acquisition of crypto mining machines with a 32 Exahash per second hashrate from Bitmain Technologies for US$256 million. This is part of a larger proposed transaction that includes a share-settled acquisition of 18 EH mining machines for US$144 million from Golden TechGen and other sellers. The cash transaction was completed after determining no U.S. antitrust clearance was required. While hash computing power has been assigned to Cango, the physical transfer of machines will occur later. The share-settled portion remains pending, subject to closing conditions.

Cango Inc. (NYSE: CANG) ha completato l'acquisizione in contante di macchine per il mining di criptovalute con un hashrate di 32 Exahash al secondo da Bitmain Technologies per 256 milioni di dollari USA. Questo fa parte di una proposta di transazione più ampia che include un'acquisizione di macchine per il mining da 18 EH con pagamenti in azioni per 144 milioni di dollari USA da Golden TechGen e altri venditori. La transazione in contante è stata completata dopo aver accertato che non era necessaria l'approvazione antitrust negli Stati Uniti. Mentre la potenza di calcolo hash è stata assegnata a Cango, il trasferimento fisico delle macchine avverrà successivamente. La parte relativa alle azioni rimane in attesa, soggetta a condizioni di chiusura.

Cango Inc. (NYSE: CANG) ha completado la adquisición en efectivo de máquinas de minería de criptomonedas con una tasa de hash de 32 Exahash por segundo de Bitmain Technologies por 256 millones de dólares estadounidenses. Esto es parte de una transacción propuesta más grande que incluye una adquisición de acciones de 18 EH máquinas de minería por 144 millones de dólares estadounidenses de Golden TechGen y otros vendedores. La transacción en efectivo se completó después de determinar que no se requería la aprobación antimonopolio en EE. UU. Mientras que la potencia de cálculo hash ha sido asignada a Cango, la transferencia física de las máquinas se realizará más adelante. La parte de acciones sigue pendiente, sujeta a condiciones de cierre.

Cango Inc. (NYSE: CANG)는 Bitmain Technologies로부터 초당 32 Exahash 해시레이트를 가진 암호화폐 채굴 기계를 현금으로 인수하는 작업을 완료했습니다. 거래 금액은 2억 5600만 달러입니다. 이는 Golden TechGen 및 기타 판매자로부터 1억 4400만 달러에 18 EH 채굴 기계의 주식 인수를 포함하는 더 큰 제안된 거래의 일환입니다. 현금 거래는 미국 반독점 승인 요구 사항이 없다고 판단된 후 완료되었습니다. 해시 컴퓨팅 파워는 Cango에 할당되었으나, 기계의 물리적 이전은 나중에 이루어질 것입니다. 주식 기반 부분은 마감 조건에 따라 보류 중입니다.

Cango Inc. (NYSE: CANG) a complété l' de machines de minage de crypto-monnaies avec un hashrate de 32 Exahash par seconde auprès de Bitmain Technologies pour 256 millions de dollars US. Cela fait partie d'une transaction proposée plus large qui inclut une acquisition d'actions de 18 machines de minage de 18 EH pour 144 millions de dollars US auprès de Golden TechGen et d'autres vendeurs. La transaction en espèces a été finalisée après avoir déterminé qu'aucune approbation antitrust aux États-Unis n'était nécessaire. Bien que la puissance de calcul hash ait été attribuée à Cango, le transfert physique des machines aura lieu ultérieurement. La partie relative aux actions reste en attente, sous réserve des conditions de clôture.

Cango Inc. (NYSE: CANG) hat die Bargeldübernahme von Krypto-Mining-Maschinen mit einer Hashrate von 32 Exahash pro Sekunde von Bitmain Technologies für 256 Millionen US-Dollar abgeschlossen. Dies ist Teil einer größeren vorgeschlagenen Transaktion, die eine aktienbasierte Übernahme von 18 EH-Mining-Maschinen für 144 Millionen US-Dollar von Golden TechGen und anderen Verkäufern umfasst. Die Bargeldtransaktion wurde abgeschlossen, nachdem festgestellt wurde, dass keine US-antitrustrechtliche Genehmigung erforderlich war. Während der Hash-Computing-Power Cango zugewiesen wurde, erfolgt der physische Transfer der Maschinen später. Der aktienbasierte Teil bleibt ausstehend, vorbehaltlich der Abschlussbedingungen.

Positive
  • Acquired significant crypto mining capacity of 32 EH/s
  • Successfully completed US$256 million cash transaction without regulatory hurdles
  • Immediate access to hash computing power before physical transfer
Negative
  • Large cash expenditure of US$256 million impacts liquidity
  • Physical transfer of mining machines delayed to later date
  • Additional share-settled transaction pending may lead to dilution

Insights

This $256 million cash acquisition of crypto mining assets marks a significant strategic pivot for Cango, traditionally an automotive transaction platform. The purchase of 32 EH/s mining capacity represents a major capital allocation, consuming a substantial portion of the company's resources given its $420 million market cap. The decision to diversify into crypto mining amid the current market dynamics is particularly noteworthy.

The structure of the deal - splitting between cash and share-settled transactions - suggests careful capital management, though the cash portion alone exceeds 60% of the company's market value. This transformation from an auto platform to a significant crypto mining player carries substantial operational and market risks, especially considering the volatile nature of cryptocurrency mining profitability.

The pending share-settled portion for $144 million worth of additional 18 EH/s capacity will further dilute existing shareholders while expanding the company's mining capabilities. Investors should carefully evaluate this strategic shift and its implications for the company's risk profile and future earnings potential.

The acquisition of 32 EH/s hashrate capacity is technically significant, representing a substantial mining operation. For context, this hashrate could account for approximately 5-7% of Bitcoin's total network hashrate, depending on network conditions. The deal with Bitmain, a leading ASIC manufacturer, suggests access to current-generation mining equipment.

The phased transfer of ownership while immediately assigning hash computing power is an interesting technical arrangement that could help manage operational transitions. However, investors should note that mining profitability depends heavily on factors like electricity costs, Bitcoin price movements and network difficulty adjustments. The success of this investment will largely depend on the company's ability to secure low-cost power and maintain efficient operations at scale.

SHANGHAI, Nov. 15, 2024 /PRNewswire/ -- Cango Inc. (NYSE: CANG) ("Cango" or the "Company"), a leading automotive transaction service platform in China, today announced that it has completed the previously announced acquisition of on-rack crypto mining machines with an aggregate hashrate of 32 Exahash per second ("EH") for a total purchase price of US$256 million in cash (the "Cash-Settled Transaction") from Bitmain Technologies Georgia Limited and Bitmain Development Limited (together, "Bitmain"), a leading manufacturer of digital currency mining servers. The Company announced the Cash-Settled Transaction on November 6, 2024, together with its proposed acquisition of on-rack crypto mining machines with an aggregate hashrate of 18 EH from Golden TechGen Limited and certain other sellers for a total purchase price of approximately US$144 million, which will be paid through issuance of shares to the sellers by the Company (the "Share-Settled Transactions" and together with the Cash-Settled Transaction, the "Proposed Transactions").

The Cash-Settled Transaction was consummated after the relevant closing conditions are satisfied. Based on further due diligence with the sellers, the Company and the sellers have concluded that no related sellers will sell U.S. assets with an aggregate value of US$119.5 million or more to the Company in the Proposed Transactions, and therefore the anti-trust filing and clearance in the U.S. is not required for the Proposed Transactions and the relevant closing condition is deemed to have been satisfied. As such, the Company and Bitmain closed the Cash-Settled Transaction through assignment to the Company of all hash computing power of the mining machines to be delivered in the Cash-Settled Transaction, and transfer of these machines' ownership to the Company is expected to occur at a later stage as agreed by the parties.

The closing of the Share-Settled Transactions is subject to certain closing conditions that are yet to be satisfied or waived and the Company is working with the relevant parties towards the closing of the Share-Settled Transactions.

About Cango Inc.

Cango Inc. (NYSE: CANG) is a leading automotive transaction service platform in China, connecting car buyers, dealers, financial institutions, and other industry participants. Founded in 2010 by a group of pioneers in China's automotive finance industry, the Company is headquartered in Shanghai and has a nationwide network. Leveraging its competitive advantages in technological innovation and big data, Cango has established an automotive supply chain ecosystem, and developed a matrix of products centering on customer needs for auto transactions, auto financing and after-market services. By working with platform participants, Cango endeavors to make car purchases simple and enjoyable, and make itself customers' car purchase service platform of choice. For more information, please visit: www.cangoonline.com. 

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the "Business Outlook" section and quotations from management in this announcement, contain forward-looking statements. Cango may also make written or oral forward-looking statements in its periodic reports to the SEC, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Cango's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Cango's goal and strategies; Cango's expansion plans; Cango's future business development, financial condition and results of operations; Cango's expectations regarding demand for, and market acceptance of, its solutions and services; Cango's expectations regarding keeping and strengthening its relationships with dealers, financial institutions, car buyers and other platform participants; general economic and business conditions; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Cango's filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Cango does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

Investor Relations Contact

Yihe Liu
Cango Inc.
Tel: +86 21 3183 5088 ext.5581
Email: ir@cangoonline.com 

Helen Wu
Piacente Financial Communications
Tel: +86 10 6508 0677
Email: ir@cangoonline.com

Cision View original content:https://www.prnewswire.com/news-releases/cango-inc-completes-cash-settled-acquisitions-of-crypto-mining-assets-302306894.html

SOURCE Cango Inc.

FAQ

What is the total hashrate of crypto mining machines acquired by Cango (CANG)?

Cango acquired crypto mining machines with a total hashrate of 32 Exahash per second (EH/s) in the cash-settled transaction.

How much did Cango (CANG) pay for the cash-settled crypto mining acquisition?

Cango paid US$256 million in cash for the crypto mining machines acquisition from Bitmain Technologies.

When did Cango (CANG) complete its cash-settled crypto mining acquisition?

Cango completed the cash-settled acquisition on November 15, 2024.

What is the value of the pending share-settled transaction for Cango (CANG)?

The pending share-settled transaction is valued at approximately US$144 million for 18 EH/s of mining capacity.

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