GRDI

June 28, 2024
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Kuehn Law, PLLC, a shareholder litigation law firm, is investigating potential claims related to the proposed merger between the below listed companies.  Kuehn Law may seek additional disclosures or other relief on behalf of the shareholders of the company being acquired.  

Kuehn Law is investigating whether the Board of Directors of the target company:

1) acted to maximize shareholder value,
2) failed to disclose material information, and
3) conducted a fair process:  
GRIID Infrastructure, Inc. has agreed to merge with CleanSpark, Inc. After the merger, GRIID shareholders will receive CleanSpark common stock based on an exchange ratio determined by dividing the total merger consideration by the number of GRIID shares issued and outstanding at the closing date.

Clean Spark Acquires GRIID Infrastructure in $155M Deal

The Bitcoin mining industry continues to consolidate, with CleanSpark (CLSK) announcing an all-stock acquisition of GRIID Infrastructure (GRDI) valued at $155 million. CleanSpark will assume GRIID's debt and other obligations, providing a $5 million bridge loan for approximately $50.9 million.

This acquisition supports CleanSpark's strategic goals. CEO Zach Bradford highlighted plans to replicate their success in Georgia, where they built over 400 MW of infrastructure backed by long-term power contracts. The acquisition is expected to enhance CleanSpark’s capacity significantly, with targets to exceed 100 MW in Tennessee by year-end, reach 200 MW next year, and surpass 400 MW by 2026.

The market responded to the announcement with GRIID shares dropping over 50%, while CleanSpark’s rose nearly 4%, indicating traders view this as a beneficial acquisition for CleanSpark. This deal is part of a broader trend of consolidation in the Bitcoin mining sector, which has intensified post-halving. Notable moves include Riot Platforms (RIOT) and Bitfarms (BITF) in a takeover battle, and Core Scientific (CORZ) being pursued by a cloud computing company.

Founded in 2018, GRIID has faced challenges, including delayed Nasdaq listing due to the crypto winter. It operates mining facilities in Watertown, New York; Limestone, Maynardville, and Lenoir City, Tennessee. The acquisition integrates these assets into CleanSpark's expanding operations.

CleanSpark’s acquisition of GRIID marks a strategic expansion in the competitive Bitcoin mining industry, setting ambitious growth targets and reinforcing its market position.

Notice to Shareholders: Directors' Fiduciary Duties

As shareholders, it's essential to understand the fiduciary duties of the Board of Directors. These duties ensure the Board acts in the best interest of the company and its shareholders.

Directors' Fiduciary Duties

1. Duty of Care

Diligence: Make informed decisions by thoroughly reviewing information.

Active Participation: Regularly attend and engage in board meetings.

Expert Advice: Seek expert opinions when necessary.

2. Duty of Loyalty

Avoid Conflicts of Interest: Prioritize the company's interests over personal gain.

Self-Dealing: Do not use the position for personal benefit.

Confidentiality: Maintain the confidentiality of company information.

3. Duty of Good Faith

Honesty: Act with integrity in all decisions.

Best Interests: Ensure actions are in the best interest of the company and shareholders.

Fairness: Treat all shareholders fairly and equally.

Your awareness and understanding of these duties are crucial in ensuring the Board acts responsibly and in the best interest of all shareholders.