Chinese internet company The9 Ltd (NASDAQ: NCTY) has recently announced its agreement to acquire Canada's Montcrypto Ltd. The purpose of this acquisition is to establish a 20MW electricity supply in Calgary, Canada.
As part of the arrangement, The9 intends to invest C$7.6 million in Montcrypto in two phases, with the goal of obtaining a controlling stake in the company.
Once the acquisition is complete, the mining facilities will have a power capacity of 20MW, which will be sufficient to operate over 6,000 S19j Antminers.
One notable aspect of Montcrypto's infrastructure is its carbon-neutral nature. This means that the power supply it offers to The9's cryptocurrency mining business is greener and more environmentally friendly.
In order to achieve this carbon-neutral status, Montcrypto has established natural gas procurement contracts with local oil extraction companies. Additionally, the company has plans to construct cryptocurrency mining facilities that operate using natural gas.
As part of the agreement, The9 will pay a hosting fee to Montcrypto at a rate of C$0.037/kWh for a period of five years.
As of December 31, 2020, The9 had $4.9 million in cash and equivalents.