A cryptocurrency company, displaced from operating at its North Bay facility, may have an inside track to resume bit coin production in northeastern Ontario.
Hut 8 Mining has signed a transaction support agreement with Macquarie Equipment Finance, the latter which is making a bid attempt to acquire all of the power producing assets of insolvent Validus Power.
Validus’ assets were placed in receivership last week by an Ontario Superior Court judge. Macquarie is a secured creditor of Validus.
In court documents, Macquarie accuses Validus management of misappropriation of funds along with several claims surrounding Validus defaulting on a $55.6-million loan agreement signed in 2022.
Validus is a holding company with power producing company entities in North Bay, Iroquois Falls, Kapuskasing and Kingston.
As part of the complex loan agreement, Macquarie owns the turbines, plant and equipment at the 120-megawatt Iroquois Falls Plant. Those assets are leased back to a Validus subsidiary company to make monthly rent payments. Macquarie accuses Validus is being behind on its rent as well.
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Hut 8 was described in court documents as a key customer of Validus.
Validus had been a power supplier to Hut 8’s bit coin “mining” facility in North Bay. The two parties are in the midst of legal dispute over an alleged breach of a power purchase agreement.
The ongoing litigation has forced Hut 8 to pull the plug on its bit coin operation in North Bay. Plans to move its machines to a different facility have been placed on hold while the potential acquisition of assets from Validus is underway.
In a news release, Hut 8 said it's supportive of an "opportunity to potentially acquire certain assets" of Validus.
The company said if Macquarie’s stalking horse bid is successful it will “result in the full and final resolution of all litigation claims and counterclaims currently pending between Hut 8 and certain Validus entities.”
