According to Blockworks, Core Scientific, a blockchain infrastructure and hosting provider, is preparing to exit bankruptcy after a Texas court approved its reorganization plan on Tuesday. The decision by the US Bankruptcy Court for the Southern District of Texas allows the company to emerge from Chapter 11 bankruptcy and relist its shares on the Nasdaq later this month. Core Scientific filed for bankruptcy in December 2022 due to difficulties generating enough revenue to cover debt obligations. The firm was among those in the sector that took out high-interest loans to fund growth during the 2021 bull market.
The reorganization plan includes a 100% recovery for all creditors and significant recovery for existing equity holders, according to court documents. The plan involves the equitization of approximately $400 million in secured and unsecured claims, as well as a reduction in annual debt service by around $60 million. Last week, the company secured financing through an oversubscribed $55 million equity rights offering. Core Scientific aims to emerge from bankruptcy on January 23 and relist its shares on Nasdaq the following day.
Core Scientific CEO Adam Sullivan said in a statement, '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.' The company continued to make deals while navigating bankruptcy proceedings, including a $53 million investment from Bitmain in September, along with a new hosting agreement. As of December 31, Core Scientific operated approximately 209,000 bitcoin miners across data centers in Texas, Georgia, Kentucky, North Carolina, and North Dakota, with an energized hash rate of 23.2 exahashes per second (EH/s). The company mined 1,177 BTC in December 2023.
