STOCKHOLM, Sept. 26, 2018 /PRNewswire/ --
Stockholm IT Ventures AB (Frankfurt Stock Exchange: SVAB - ISIN SE 0006027546), today announced it has entered into a binding Memorandum of Understanding ("MOU") with Evolution Global AS, a developer of innovative solutions for crypto mining to acquire an option to purchase up to 10,000 Petahash of Bitcoin mining capacity to be mined Evolution Global.
Evolution Global is in the final stages of developing a new application-specific integrated circuit (ASIC) chip that is likely to outperform all Bitcoin mining ASICs and mining equipment in terms of costs and could therefore be able to deliver a substantial share of the remaining Bitcoins available to be mined. An independent consultant engaged by SITV conducted this summer a technical due diligence of the chip and concluded it is likely Evolution Global will succeed.
The parties have agreed to secure funding for the chip development through the joint setup of a new public company to be named Cryptoplants AB in where Stockholm IT Ventures will hold a 45% equity stake. External funding will be raised into the company, relieving Stockholm IT of financial undertakings. On success, Stockholm IT can purchase capacity from Evolution Global at a low cost. This option will be subdivided into holders of the Bytemine token that is currently in an ICO process lead by Stockholm IT.
Stockholm IT Ventures CEO Anthony Norman commented: "After Stockholm IT initiated the Cryptotech project in early 2018 which was later put on hold, we have taken a very careful stance toward the mining chip development segment given the market conditions. We have however followed the development lead by Erik Solberg closely and we believe that if successful, this provides us with a huge upside. This deal allows us to pursue the opportunity without financial exposure to Stockholm IT. Having seen the latest results and the due diligence we are strong believers in the ability of Evolution Global to succeed."
Evolution Global CEO Erik Solberg said: "After I engaged a new chip development team earlier this spring our progress has been very successful, and we have had a lot of interest from potential large customers all around the world. However, Stockholm IT presented an offer that is a win-win situation for both of our companies. We look forward to become partners in Cryptoplants and together start the mining in 2019."
Key highlights of the MOU
- Cryptoplants has been granted an option ("Option") for an option price payment to Evolution Global of up to €6,000,000 in instalments over an approximate five-month period to acquire up to 10,000 Petahash for an agreed discounted purchase price of €120/Terrahash, over a period of up to three years, or in some instances a longer period. The effective all-in price of the PH is approximately 20% to 25% of the all-in price typically available from Bitcoin cloud mining contracts. At current market prices for Petahash, current conversion rates for Petahash into Bitcoin and current prices for Bitcoin, the Option potentially may generate a pre-tax profit for Cryptoplants in excess of €1,000,000,000. The actual profitability could be materially less and will depend on the performance of the new ASIC, trends in pricing for Petahash and Bitcoins, the number of Petahash required to generate Bitcoins and the timing and methods used to finance and monetize the Option. In addition, it is likely that Cryptoplants will sell equity and or incur debt to fund a portion of the purchase price of the Option.
- The Option may be exercised in whole or in part and from time-to-time on a pro rata basis with certain other Evolution Global customers and Petahash to be retained by Evolution Global. The Option may be assigned in whole or in part, subject to customary AML and KYC requirements. If Cryptoplants funds only a portion of the Option, Cryptoplants' right to purchase the initial Petahash will be reduced pro rata or delayed.
The MOU is effective immediately. If definitive agreements pertaining to certain ancillary matters are not executed by November 15, 2018, under certain conditions, the MOU may be terminated.
The summary description in this press release is qualified by the more complete terms set forth in the MOU and to be set forth in definitive agreements.
About Stockholm IT Ventures AB
Stockholm IT Ventures AB is a Swedish public company listed on the Frankfurt Stock Exchange under the ticker symbol SVAB since 2014. Stockholm IT specialises in cryptocurrency mining and production, crypto asset management and related FinTech and Blockchain technologies. For more information, visit www.stockholmit.co. You can also find them on Facebook, Twitter and LinkedIn. Details on Stockholm IT's Bytemine (BYTM) token and White Paper can be found here: www.bytemine.io.
About Evolution Global AS
Evolution Global AS was established by Erik Solberg in the spring of 2018. Evolution Global has engaged an international team of chip developers with a proven track record that has been working on the development and testing since April 2018. The company is in the final steps of introducing a new chip that is likely to outperform all Bitcoin mining ASICs in terms of cost. The company is planning to sell 15,000 Petahash of mining capacity in total to external customers, and it also has an agreement with Cryptotech AS to deliver hashrate to all of their customers.
Stockholm IT Ventures AB,
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SOURCE Stockholm IT Ventures