Cipher Mining Expands Partnership with FluidStack, Securing $830M+ Revenue

By Hao Liu • Thursday, November 20 10:23 • Permanent Link

Cipher Mining Inc. (NASDAQ:CIFR) has recently announced a significant expansion of its partnership with FluidStack, a premier AI cloud platform. The 10-year high-performance computing (HPC) colocation agreement includes the delivery of an additional 39 MW of critical IT load, supported by a maximum of 56 MW of additional gross capacity, at Cipher's Barber Lake site in Colorado City, Texas.

This expansion is set to secure approximately $830 million in contracted revenue over the initial 10-year term, with the potential for an increase to approximately $2.0 billion if two five-year extension options are exercised, and up to $9.0 billion in total for the entire lease if all extension options are utilized. The agreement also includes a modified gross lease with annual escalators and an expected site net operating income (NOI) margin of 85%-90%.

In addition to the partnership expansion, Google has increased its backstop of FluidStack's lease obligations by an additional $333 million, bringing the total backstop to $1.73 billion. This new backstop aims to support project-related debt, with Cipher having committed financing in place.

Cipher's CEO, Tyler Page, expressed excitement about the expanded partnerships with FluidStack and Google, highlighting the company's position as a leader in HPC development and the strong momentum driving growth across its pipeline of sites.

The company also provided insights into its estimated project costs, with approximately $9-$10 million per MW of critical IT load, and highlighted that it maintains a growing pipeline of approximately 3.2 GW prioritized for HPC.

Cipher's financial advisor for the transaction was Morgan Stanley & Co. LLC, with legal counsel provided by Davis Polk & Wardwell LLP for the company, and Cooley LLP for FluidStack.

This expansion further cements Cipher's focus on the development and operation of industrial-scale data centers for Bitcoin mining and HPC hosting, with the aim of becoming a market leader in innovation in these areas. Following these announcements, the company's shares moved 0.27%, and are now trading at a price of $14.62. For the full picture, make sure to review Cipher Mining's 8-K report.

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