Attack by Boatman Capital on London Bitcoin miner Argo Blockchain

Argo Blockchain claims Boatman’s claims about a $17 million deal to buy Texas land are “unfounded”.

An alleged purchase of land in Texas by a bitcoin miner listed on the London Stock Exchange, linked to potential investments by Elon Musk, is being investigated.

Boatman Capital, a low-profile research company claims that Argo Blockchain’s agreement to spend $17.5m on land that is only $168,000 raises serious governance questions about how this deal was made and who it benefits.

Boatman’s claims were unfounded, and the company’s boss Peter Wall insisted that the Texas land acquisition was a solid deal.
 

Company annoncment, 9th August 2021
 

Argo Blockchain, which uses powerful computers to perform complex calculations to “mine” bitcoin, has rode the recent boom in cryptocurrency. Its shares increased from 6p up to nearly 130p in the past year, making it worth £500m.

Unsubstantiated reports that Tesla’s Mr Musk had purchased a stake in Argo Blockchain pushed shares up 17 percent last month.

Boatman’s latest criticism of Babcock, Britain’s second-largest contractor, is the latest. It made headlines almost three years ago.

The short-seller launched a fierce attack on Anglo-American’s spin-off of South African coal mines in June.

Argo Blockchain announced in February that it had agreed to purchase 320 acres of land at $5m per share initially. This will increase to $17.5m after other milestones are met.

Later, the company clarified that the land was 160 acres. The proceeds of £49m were raised from shareholders during the first three months.

Boatman had the land formalized valued by a Texas certified real estate appraiser. The appraisal concluded that the land was worth $168,000.

A spokesperson for Argo Blockchain stated that the report had been published before it was actually published. We have not reviewed this report, so we cannot comment on its contents.

After having seen the report, Mr Wall was appointed interim chairman and chief executive officer. He defended the Texas land at a fair price.

He said, “We felt that it was an excellent deal because it wasn’t just a land purchase, it was also a project acquisition.” It was a shovel-ready job that saved us 12-18 months of work Argo would have to do if we hadn’t acquired it.

Wall said that he believed that waiting, and trying to find a piece of land on our own would have too high a cost. Waiting would cost too much. It was a solid deal, we feel.”

The Boatman attack could have ruined the glow of Argo Blockchain’s record results for the first six months. Pre-tax profit increased from $523,074 at $10.7m to $31.1m revenue.

Wall stated that he had capitalized on changes in the market conditions during the first half 2021 to deliver strong growth both in revenues and profits. This is an indication of how smart growth strategies are delivering value for shareholders.


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