Tether and Rumble Eye Full Acquisition of Northern Data
Tether and Rumble have announced their intention to jointly acquire all shares of Northern Data, a company specializing in artificial intelligence infrastructure. This move would enable them to take complete control of the company.
Expanding Northern Data’s Capabilities
In a recent announcement by Rumble, the proposed acquisition aims to expand upon Northern Data’s current operations in AI and high-performance computing (HPC). Tether, known for issuing the USDt (USDT) stablecoin, is already Northern Data’s largest shareholder and is backing this transaction. The company has also suggested future partnerships focused on AI, peer-to-peer communications, and data storage solutions.
Strengthening Collaborations
Tether plays a pivotal role in linking the companies involved in this potential deal. At the end of 2024, Tether invested $775 million into Rumble, a platform known for its anti-censorship stance similar to YouTube. Their collaboration deepened in May when Rumble launched a Bitcoin (BTC) and stablecoin wallet that supports USDT.
Northern Data’s Strategic Divisions
Northern Data operates three main divisions: Taiga Cloud, offering GPU cloud services; Ardent Data Center, providing essential data infrastructure; and Peak Mining, dedicated to Bitcoin mining. The company has plans to divest its mining operations to concentrate on AI and HPC, with proceeds from the sale earmarked for reinvestment in these areas.
Shareholder Impact and Valuation
If the acquisition proceeds, Northern Data shareholders are expected to receive 2.319 newly issued Class A Rumble shares for each share they hold. This exchange would result in Northern Data shareholders controlling approximately 33.3% of Rumble.
Based on Rumble’s closing share price of $7.88 as of Friday, this offer values Northern Data shares at $18.27 each, translating to an overall valuation of about $1.17 billion.
Financial Adjustments and Future Prospects
The deal is also subject to adjustments based on the potential sale of Peak Mining, Northern Data’s Bitcoin mining unit. Once the transaction is finalized, Tether is anticipated to become the largest single holder of Rumble’s Class A common stock.
Moreover, Tether plans to modify the current loan arrangement with Northern Data to ensure the acquired business has adequate financial flexibility. In late 2023, Tether extended debt financing of 575 million euros (approximately $610 million) to Northern Data.
